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Weatherford restructuring and Moody’s rating

Moody's Investors Service has revised the Bermuda-incorporated Weatherford International Ltd’s rating outlook from negative to stable and assigned a B3 rating to the company’s proposed $1.5 billion senior unsecured notes due in 2030.

At the same time, Moody’s affirmed all other ratings, including Weatherford's B2 Corporate Family Rating (CFR), B2-PD Probability of Default Rating (PDR), B3 senior unsecured notes and Ba3 rating on the secured letters of credit (LC) facility and the secured notes.

Weatherford International Ltd (Bermuda) is a wholly owned subsidiary of the Irish-incorporated Weatherford International plc, which provides a wide range of services and equipment to the global oil and gas industry.

The Bermuda company has been involved in restructuring initiatives.

The rating agency said that about $2.8 billion of the company’s rated debt is affected.

Net proceeds from the proposed debt offering along with balance sheet cash will be used to redeem roughly $1.5 billion of the company's existing 11 per cent unsecured notes due in 2024 through a tender offer process that was launched concurrently with the notes offering.

"The stable outlook reflects Weatherford's reduced refinancing risk and gradually improving operating environment," Sajjad Alam, Moody's vice-president, said.

The new notes will be issued by Weatherford International Ltd (Bermuda) and rank pari passu with the company's existing 2024 unsecured notes.

The new and existing notes are rated B3, one notch below the B2 corporate family rating because of the significant amount of priority-claim secured debt in Weatherford's capital structure.

Weatherford's LC facility and 2028 notes have a secured first-lien claim to the company's assets. The recently issued 2028 secured notes and the proposed unsecured notes have the same guarantors, including Weatherford International plc, the ultimate parent company, and Weatherford International LLC, which owns Weatherford's US subsidiaries.

Sajjad Alam, Moody's vice-president (Photograph supplied)

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Published October 12, 2021 at 2:36 pm (Updated October 12, 2021 at 4:22 pm)

Weatherford restructuring and Moody’s rating

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