S&P Downgrades Swift Energy (SFY) to 'D' Amid Missed Interest Payment

Standard & Poor's Ratings Services lowered its corporate credit and issue-level ratings on Houston-based oil and gas exploration and production company Swift Energy Co. to 'D' from 'CCC'. The recovery rating on the company's unsecured debt remains '4', indicating our expectation of average (30%-50%, lower end of the range) recovery in the event of a payment default.

"The 'D' ratings reflect Swift Energy Co.'s announcement that it has missed an $8.9 million interest payment on its $250 million 7.125% senior notes due 2017, and our belief that the company will not make this payment before the grace period ends on Dec. 29, 2015," said Standard & Poor's credit analyst Carin Dehne-Kiley. "We believe that the default will be a general default and the company will fail to pay all or substantially all of its obligations as they come due," she added.

The company has also disclosed that it is engaged in ongoing negotiations with a group of holders of its outstanding senior notes (including the 2017 notes) regarding a potential restructuring, along with possible avenues for increasing its near-term liquidity.

For our most recent recovery analysis on Swift Energy, see the research update published July 17, 2015, on RatingsDirect.

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