Moody’s changes Phoenix Natural Gas to stable

Moody's Investors Service said it changed the outlook on the Baa2 rating assigned to the bond issued by Phoenix Natural Gas Finance plc, the wholly owned financing subsidiary of Phoenix Natural Gas Ltd., to stable from negative.

Concurrently, the agency affirmed the Baa2 rating.

Moody’s said the outlook change reflects that Phoenix Natural Gas put in place enduring liquidity arrangements following documentation closure on a recent £280 million U.S. Private Placement (USPP) issuance, maturing August 2024, guaranteed by Phoenix Natural Gas.

While the proceeds are not scheduled to be received until five days before the group's only outstanding bond (£275 million 5.5% July 2017) falls due, Moody's said it believes refinancing risk is minimal.

This reflects: (a) The diverse group of highly rated capital providers for the USPP notes; (b) that the issuance was oversubscribed on pricing; and (c) that Phoenix Natural Gas has £90 million of undrawn committed facilities that can be used for debt repayment.

Following this, Phoenix Natural Gas’ next debt maturity is not until 2022 (the recently renewed and upsized bank term loan and, currently fully undrawn, liquidity facilities).

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