The offshore service sector faces continuing challenges that have led to weaker-than-expected profitability and leverage metrics for Houston, Texas-based Oceaneering International Inc., a diversified offshore service provider. As a result, we are lowering our issuer credit rating on Oceaneering to 'BB+' from 'BBB-'. At the same time, we are lowering our issue-level rating on the company's unsecured notes to 'BB+' from 'BBB-'. We assigned a '3' recovery rating to this debt, indicating our expectation of meaningful (50%-70%; rounded estimate: 65%) recovery to creditors in the event of a payment default. The negative outlook reflects the risk that we could lower our rating further if Oceaneering's operating and leverage metrics do not improve in line with our current expectations over the
