S&P: EXCO Resources unaffected

Standard & Poor's said its ratings and outlook on EXCO Resources Inc. (B+/stable/--) will not be immediately affected by EXCO's announcement that it is exploring strategic alternatives for its wholly owned Canadian subsidiary Addison Energy Inc., including the possible sale of the unit.

However, EXCO's Canadian assets represent a substantial portion of EXCO's business, about 43% of the company's production, which if sold could materially weaken financial metrics until that production is replaced. If the assets are sold, S&P said it expects the realized proceeds to be reinvested into oil and gas properties in a manner that does not weaken EXCO's financial profile.

Negative rating actions are likely if the company deviates from these expectations.

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