GIP III Stetson I L.P. and GIP III Stetson II L.P. Ratings Lowered On Announced Distribution Cut; Outlook Stable

We are lowering our issuer credit rating on GIP III Stetson I L.P. (Stetson) and GIP III Stetson II L.P. to 'B' from 'B+' and the issue-level rating to 'B' from 'B+'. The '3' recovery rating on the $1 billion term loan B due 2025 indicates our expectation that lenders will receive meaningful (50%-70%; rounded estimate: 50%) recovery in the event of a payment default. The downgrade is driven by our expectations that leverage will remain above 4x for the next two years due to EnLink Midstream, LLC's announcement that it will cut its distribution by nearly 35% to $0.75 per unit annually from our previous expectation of about $1.13 per unit annually. The stable outlook reflects our expectation that

...January 21, 2020 - We are lowering our issuer credit rating on GIP III Stetson I L.P. (Stetson) and GIP III Stetson II L.P. to 'B' from 'B+' and the issue-level rating to 'B' from 'B+'. The '3' recovery rating on the $1 billion term loan B due 2025 indicates our expectation that lenders will receive meaningful (50%-70%; rounded estimate: 50%) recovery in the event of a payment default. - The downgrade is driven by our expectations that leverage will remain above 4x for the next two years due to EnLink Midstream, LLC's announcement that it will cut its distribution by nearly 35% to $0.75 per unit annually from our previous expectation of about $1.13 per unit annually. - The stable outlook reflects our expectation that the company will maintain adequate liquidity and stand-alone adjusted debt leverage in the 4x-5x range and consolidated adjusted debt leverage (inclusive of EnLink) in the mid- to high-5x area over the next 12 months. The stable outlook also reflects our belief that EnLink...

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