TEXT-S&P rates Bristow Group notes 'BB'
Sept 27 - Standard & Poor's Ratings Services today assigned its 'BB' issue rating to Bristow Group Inc.'s proposed $425 million senior unsecured note offering. We have assigned a '4' recovery rating to this debt, indicating our expectation of average (30% to 50%) recovery, albeit at the low end of this range, in the event of payment default. Our 'BB' corporate credit rating and negative outlook on the company remains unchanged. Bristow plans to use the proceeds to redeem its $350 million of senior unsecured notes due 2017 and for general corporate purposes, including repayment of other debt. As of June 30, 2012, Bristow had slightly more than $1 billion of Standard & Poor's adjusted debt. The ratings on Houston-based Bristow Group Inc. (Bristow) reflect Standard & Poor's Ratings Services' view of its participation in the highly cyclical and volatile oil and gas industry, exposure to weather and seasonal fluctuations that might limit flight hours, aggressive financial policy, and the capital spending needs inherent in the aviation industry. Our ratings also reflect that Bristow's earnings and funds from operations (FFO) tend to be more stable than its oilfield services peers' due to contract structure, geographic diversity, and its mostly production-oriented (versus development work for exploration and production companies). We consider Bristow's business risk to be "fair", its financial risk to be "aggressive", and sources of liquidity to be "adequate". RELATED RESEARCH AND CRITERIA -- Methodology: Business Risk/Financial Risk Matrix Expanded, Sept. 18, 2012 -- Liquidity Descriptors For Global Corporate Issuers, Sept. 28, 2011 -- Criteria Guidelines For Recovery Ratings, Aug. 10, 2009. -- Corporate Ratings Criteria 2008, published April 15, 2008. -- 2008 Corporate Criteria: Analytical Methodology, April 15, 2008 RATINGS LIST Bristow Group Inc. Corporate credit rating BB/Negative/-- New Rating Senior unsecured Proposed $200 mil notes due 2022 BB Recovery rating 4 Proposed $225 mil notes due 2020 BB Recovery rating 4 Complete ratings information is available to subscribers of RatingsDirect on the Global Credit Portal at www.globalcreditportal.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column.
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