S&P cuts Noble, debt to BBB

Standard & Poor's said it lowered its long-term corporate credit on Noble Corp. to BBB from BBB+ and removed the rating from CreditWatch, where it was placed with negative implications on Oct. 29.

The outlook is stable.

At the same time, the agency lowered its issue-level rating on the company's senior unsecured debt to BBB from BBB+ and removed it from CreditWatch negative.

"The downgrades reflect the rapidly deteriorating commodity price environment and our expectation that the offshore drilling sector will remain weak," S&P credit analyst Susan Ding said in a news release.

"The downgrades also incorporate the company's fleet concentration in relatively older semisubmersible rigs because we expect this segment to come under pressure as newer, more technologically advanced rigs enter the market."

Noble and its peers are likely to face competitive pressures that could lower day rates for both new rigs and the existing fleet, leading to weaker-than-expected financial performance, S&P said.

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