Moody’s cuts Williams CFR, notes to Ba2

Moody's Investors Service said it downgraded Williams Cos., Inc.'s corporate family rating to Ba2 from Ba1 and its senior unsecured notes ratings to Ba2 from Ba1.

The SGL-3 speculative grade liquidity rating was affirmed and the outlook is negative.

This concludes the ratings review for downgrade that was initiated on Sept. 29, 2015.

Additionally, Moody's affirmed Williams Partners, LP's (WPZ) Baa3 senior unsecured ratings and its Prime-3 short-term rating. The Baa2 senior unsecured ratings of WPZ's wholly owned pipeline subsidiaries, Northwest Pipeline and Transcontinental Gas Pipeline Co., were also affirmed.

The outlook on WPZ and its rated subsidiaries remains negative.

"The downgrade of Williams was driven by our expectations for weaker credit metrics at the parent company level, including higher financial leverage caused by less retention of cash distributions from WPZ," Moody's senior vice president Pete Speer said in a news release.

"The affirmation of WPZ's Baa3 rating reflects the partnership's effectively reduced distribution burden and other plans to sustain its financial leverage and distribution coverage at levels supportive of its ratings.”

“However, the challenges posed by weak commodity prices and customer volume headwinds along with the execution risk on planned asset sales and growth projects has resulted in our maintaining the negative outlook," Speer added in the release.

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