Moody’s rates Harvest Midstream Ba3, notes B1

Moody’s Investors Service said it assigned first-time ratings to Harvest Midstream I, LP, including a Ba3 corporate family rating, a Ba3-PD probability of default rating and a B1 rating to its proposed issuance of $600 million senior unsecured notes.

“Harvest Midstream generates a stable, contract-based revenue stream, over 80% of which is generated under fixed-fee contracts, providing a degree of certainty to cash flow available for debt service,” said Andrew Brooks, a Moody’s vice president, in a press release. “Moreover, with modest levels of projected growth capital spending, and a limited initial distribution payout, Harvest Midstream should be able to rapidly de-lever to its targeted level of under 3.5x debt/EBITDA.”

Harvest Midstream intends to use the proceeds to repay its term loan and amounts outstanding under its revolving credit facility.

The outlook is stable.

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