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Fitch rates Earthstone Energy notes B+
Fitch Ratings said it assigned B+/RR4 ratings to Earthstone Energy Holdings, LLC's planned unsecured notes due 2031.
The agency affirmed Earthstone’s B+ issuer and senior unsecured ratings on June 16.
The company intends to use the proceeds to fund a portion of the $1 billion net purchase price for the announced Novo Oil & Gas Holdings, LLC acquisition and potentially for the reduction of outstanding reserve-based credit facility borrowings.
“Fitch views the company proposed unsecured note issuance as relatively credit-neutral as it will reduce the reliance on the company's RBL facility and improve liquidity despite adding permanent debt to the capital structure. Fitch believes the proposed note sizing is adequate and the long-term capital structure will be commensurate with peers of similar size and scale,” the agency said in a press release.
The outlook is positive.
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