Moody's gives EXCO loan Ba3

Moody's Investors Service said it assigned a Ba3 rating to EXCO Resources, Inc.'s $300 million senior secured term loan and affirmed its B1 corporate family rating and B3 senior unsecured notes rating.

The outlook is stable.

"While XCO's July acquisition of producing and undeveloped oil and gas properties in the Haynesville and Eagle Ford shale formations is a leveraging transaction, we are of the view that XCO's leverage metrics will accommodate the increased debt levels the transaction represents within the parameters of its B1 CFR," Moody's vice president Andrew Brooks said in a news release.

"The acquired producing assets will augment existing cash flow, which is in decline, and Eagle Ford adds modest oil exposure, contributing an element of diversity to an asset base that has struggled to generate economic returns given the company's near total exposure to natural gas."

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