Preferred Proppants LLC Rating Lowered To #CCC# On Weaker Credit Profile And Outlook Negative

Stocks and Financial Services Press Releases Thursday July 14, 2016 08:42
NEW YORK--14 Jul--S&P Global Ratings
NEW YORK (S&P Global Ratings) July 13, 2016--S&P Global Ratings said today itdowngraded Radnor, Pa.-based sand producer Preferred Proppants LLC to 'CCC'from 'B'. The outlook is negative.

At the same time, we lowered our issue-level rating on the company'sfirst-lien term loan to 'CCC+' from 'B+'. The '2' recovery rating on the debtis unchanged, indicating our expectation of substantial (70%-90%; lower halfof the range) recovery of principal and interest in the event of a paymentdefault.

"The negative outlook reflects our expectation that Preferred Proppants'liquidity position will remain under pressure over the next 12 months,increasing the risk of a default or distressed debt restructuring," said S&PGlobal Ratings credit analyst Ryan Gilmore.

We could lower ratings if a default, distressed exchange, or redemptionappeared inevitable within six months. This could occur if demand and pricesfor frac sand remained at current levels, resulting in further cash and ABLfacility usage, or if the company breached its financial covenants.

It is unlikely we would raise the rating in the next 12 months given theweakness in the oil and gas market. However, we could raise ratings if wedeemed liquidity to be adequate. This could occur if Preferred Proppantsimproved its liquidity position via asset sales or other capital infusion suchthat we did not anticipate a liquidity shortfall or other default scenarioover the subsequent 12 months.


Latest Press Release

Standard Chartered Bank: 2019 Global Economic Growth Expected to Ease Modestly

he tide is going out for the global economy. Standard Chartered Bank expects the world growth to ease modestly to 3.6% in 2019 from 3.8% in 2018. Synchronised global growth at the beginning of 2018 has given way to more divergent growth trends. Several...

Photo Release: SCB showcases its first The DOTs at China Town project to connect successes for new generation business owners

Siam Commercial Bank (SCB) is moving forward in promoting Thai SMEs recently joining with Thammasat University's Faculty of Commerce and Accountancy to organize "The DOTs" project, a new professional management skill course promoting the success of the...

Echoworx expands EU reach with new German data centre

Echoworx is pleased to announce the opening of their new data centre in Germany. This move further entrenches Echoworx's presence and competitive edge within the EU region. Known for its proven manufacturing industries, from automotive to...

EXIM Thailand Holds FX Risk Management Seminar Phase 2 to Promote the Use of FX Risk Hedging Tools for SME exporters

Mr. Chana Boonyachai (right), Executive Vice President of Export-Import Bank of Thailand (EXIM Thailand), recently welcomed Mrs. Varintorn Chaivivat (left), Vice-Director, Northern Region Office, Bank of Thailand and Mr. Kobsak Duangdee (center),...

Photo Release: Prudential Thailand organizes Agency Kick Off 2019

Mr. Aman Chowla (7th from right), Chief Executive Officer, Prudential Life Assurance together with Mr. Wichai Cheewasrirungruang (6th from left), Chief Agency Officer, Prudential Life Assurance and the executive management of Prudential Life Assurance...

Related Topics