S&P rates Transocean Phoenix 2 notes BB+

S&P said it assigned its BB+ issue-level and 1 recovery ratings to Transocean Phoenix 2 Ltd.'s planned $600 million senior secured notes due 2024.

The notes will be guaranteed by parent companies Transocean Ltd. and Transocean Inc. and by a wholly owned indirect subsidiary of the company.

The company expects to use proceeds to finance a portion of the cost of construction of the drillship Deepwater Thalassa.

The 1 recovery rating reflects the agency’s expectation of meaningful (90% to 100%) recovery to creditors in the event of a payment default.

The new notes will be secured by the Deepwater Thalassa, which is under a 10-year contract with a subsidiary of Royal Dutch Shell plc at a favorable dayrate relative to current market conditions. The contract also includes termination fees.

Transocean Inc.’s BB- long-term corporate credit rating, with a negative outlook, and the BB- issue-level and 3 recovery ratings on its existing senior unsecured debt are unchanged.

S&P said the ratings reflect its assessment of Transocean’s satisfactory business risk profile, aggressive financial risk profile and strong liquidity.

The ratings incorporate the company's position as the largest global offshore drilling company and our view of the fleet's significant deepwater and midwater component as being less competitive during an industry downturn.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.