Fitch cuts Odebrecht notes to CC

Fitch Ratings said it downgraded the senior secured notes issued by Odebrecht Offshore Drilling Finance Ltd. and Odebrecht Drilling Norbe VIII/IX Ltd. to CC from CCC.

The agency also revised its recovery estimate (RE) for Odebrecht Offshore to RE60% from RE80% and its RE for Odebrecht Drilling to RE70% from RE80%.

Fitch said the downgrade reflects the increased liquidity pressure on the notes, as operating cash flows have not been sufficient to cover all operating expenses, capex and debt service in recent quarters.

The ratings also reflect the continued depressed oil market conditions, the linkage to Petrobras' credit quality and the overall strength of the off-takers' payment obligation.

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