Moody's could cut Oneok

Moody's Investors Service said it placed Oneok, Inc.'s Baa2 senior unsecured rating and P-2 commercial paper rating under review for downgrade.

This action was prompted by Oneok's announcement that it will spin off its natural gas distribution segment to shareholders as an independently owned gas distribution company (ONE Gas, Inc.).

The spin, and the previously announced discontinuation of operations in its energy services segment, will leave Oneok solely holding the 2% general partner and 41.3% limited partnership interests in Oneok Partners, LP whose ratings are unaffected by Oneok's review.

Moody's said the review for downgrade reflects the expected loss of the cash flow stream derived from Oneok's three gas distribution utilities, which are highly stable and contribute meaningfully to debt service coverage at Oneok.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.