Neovia Logistics L.P. Rating Lowered To 'CCC' On Near-Term Maturities; Debt Ratings Lowered; Outlook Negative

Neovia Logistics L.P. faces maturities across its capital structure over the next 18 months. Its revolving credit facility (of which $48 million is drawn) matures in February 2020, its $76.6 million unsecured payment-in-kind (PIK) notes mature in April 2020, and its $465 million senior secured notes mature in August 2020. We believe that the company's liquidity is insufficient to repay the revolver. We would expect that the company would also need to address its other upcoming maturities, which could lead to an exchange offer that we would classify as distressed and tantamount to a default. Therefore, we are lowering our issuer credit rating on Neovia to 'CCC' from 'CCC+'. The outlook is negative because we view the company as vulnerable

...+ Neovia Logistics L.P. faces maturities across its capital structure over the next 18 months. Its revolving credit facility (of which $48 million is drawn) matures in February 2020, its $76.6 million unsecured payment-in-kind (PIK) notes mature in April 2020, and its $465 million senior secured notes mature in August 2020. + We believe that the company's liquidity is insufficient to repay the revolver. We would expect that the company would also need to address its other upcoming maturities, which could lead to an exchange offer that we would classify as distressed and tantamount to a default. + Therefore, we are lowering our issuer credit rating on Neovia to '###' from '###+'. The outlook is negative because we view the company as vulnerable to a payment default or distressed exchange over the next year. + At the same time, we are lowering our issue-level ratings on the company's senior secured notes to '###' from '###+' with the '4' recovery rating (rounded estimate: 35%) unchanged,...

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