trending Market Intelligence /marketintelligence/en/news-insights/trending/djlj52szr5q8cfcauo-bkw2 content esgSubNav
In This List

Moody's downgrades EV Energy Partners on restructuring plan

Podcast

Next in Tech | Episode 49: Carbon reduction in cloud

Blog

Using ESG Analysis to Support a Sustainable Future

Research

US utility commissioners: Who they are and how they impact regulation

Blog

Q&A: Datacenters: Energy Hogs or Sustainability Helpers?


Moody's downgrades EV Energy Partners on restructuring plan

Moody's lowered its ratings on EV Energy Partners LP after the partnership struck a restructuring support agreement with some of its note holders and lenders, citing an expected loss to the bondholders as a result of the agreement.

The rating agency downgraded EV Energy Partners' corporate family rating to Caa3 from Caa2, its probability of default rating to Ca-PD from Caa2-PD, and its senior unsecured notes rating to Ca from Caa3, with a negative ratings outlook, according to a March 15 news release.

EV Energy Partners entered into a restructuring deal with 70% of holders of its 8.0% senior notes due 2019 and lenders holding about 94% of amounts outstanding under its reserve-based lending facility. The partnership is planning to file for Chapter 11 bankruptcy protection by April 8, with solicitation of consent from the remaining bondholders launched March 14.

The reorganization plan would involve the amendment of its reserve-based lending facility and eliminate over $343 million of principal and interest on the senior notes in exchange for 95% of the reorganized entity's new common equity. The unit holders stand to receive 5% of the reorganized entity's equity and the option to acquire up to 8% of the equity within five years.

Once EV Energy Partners files for bankruptcy protection, Moody's will lower its probability of default rating to D-PD and withdraw the ratings. The negative outlook reflects certainty in the restructuring pushing through.

EV Energy partners is a Houston-based oil and gas exploration and production master limited partnership with operations in the Appalachian Basin, the Mid-Continent and the Permian Basin.