Fitch Downgrades Schahin Oil & Gas Ltd. to 'D'

CHICAGO--(BUSINESS WIRE)-- Fitch Ratings has downgraded the foreign and local currency Issuer Default Ratings (IDRs) for Schahin Oil & Gas Ltd. (Schahin) to 'D' from 'C' following the company's bankruptcy filing.

KEY RATING DRIVERS

Fitch's rating action reflects Schahin's request for bankruptcy protection after unsuccessful attempts to obtain new financing to operate, and extend its debt maturity profile schedule. The situation has been aggravated by the ongoing Lava-Jato investigations related to the Engineering and Construction (E&C) subsidiary of the group, Schahin Engenharia S.A., and the group's temporary ban from participating in new contracts with Petrobras.

KEY ASSUMPTIONS

--Fitch assumes the court will accept Schahin's bankruptcy filings.

RATING SENSITIVITIES

The company's ratings reached the lowest level in Fitch's rating scale. An upgrade is unlikely at this time given the group's bankruptcy protection filling.

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

--'Corporate Rating Methodology' (May 28, 2014).

Applicable Criteria and Related Research:

Corporate Rating Methodology - Including Short-Term Ratings and Parent and Subsidiary Linkage

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=749393

Additional Disclosure

Solicitation Status

http://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=983497

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Fitch Ratings
Primary Analyst
Lucas Aristizabal
Senior Director
+1 312-368-3260
Fitch Ratings, Inc.
70 W Madison Street
Chicago, IL 60602
or
Secondary Analyst
Alexandre Garcia
Associate Director
+ 5511 4504 2616
or
Committee Chairperson
Mauro Storino
Senior Director
+ 5521-4503-2625
or
Media Relations:
Elizabeth Fogerty, +1 212-908-0526
[email protected]

Source: Fitch Ratings

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