S&P rates Exterran loan BB+, notes BB-

Standard & Poor’s said it assigned a BB- corporate credit rating to Exterran Corp.

The agency also said it assigned a BB+ rating to Exterran Energy Solutions LP’s $750 million senior secured revolving credit facility due 2020.

The recovery rating on the facility is 1, reflecting 90% to 100% expected default recovery.

S&P also said it assigned a BB- rating to its senior unsecured notes due 2022. The recovery rating on the notes is 3, indicating 50% to 70% expected default recovery.

The outlook is stable.

The outlook reflects an expectation that the company will sustain strong margins in its contract operations businesses and continue to execute projects from the backlog in its fabrication business while maintaining adequate liquidity and adjusted debt-to-EBITDA at less 3x, S&P said.

Exterran Holdings is spinning off its international segment to form Exterran Corp., which plans to issue $400 million senior unsecured notes and $750 million senior secured revolving credit facility.

Exterran will use the proceeds from the notes to pay down debt at Exterran Holdings, the agency said.

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