Moody's might upgrade EXCO

Moody's Investors Service said it placed EXCO Resources, Inc.'s ratings under review for upgrade, including its B2 corporate family and probability-of-default ratings and Caa1 (LGD5, 84%) senior unsecured note rating.

The outlook had been negative pending firm announcement of a long-awaited large leverage-reduction plan and continued retention of bank borrowing capacity and covenant clearance sufficient to cover liquidity needs, the agency said.

The review for upgrade reflects the likely forthcoming major debt reduction and reduced ongoing drilling and development risk and capital spending burden if EXCO closes its property monetization and drilling and development joint venture with BG Group plc and its other pending modestly sized property divestitures, Moody's said.

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