Moody's cuts Precision Drilling

Moody's Investors Service said it lowered both the corporate family rating and probability of default rating of Precision Drilling Corp., a subsidiary of Precision Drilling Trust, to Ba2 from provisional Ba1.

The senior secured debt rating is unchanged at provisional Ba1 (LGD-3, 37%), the agency said, noting that the senior unsecured debt rating was withdrawn.

The SGL-2 speculative-grade liquidity rating, indicating good liquidity, is unchanged, Moody's noted. The outlook is negative.

The lowering of the corporate family rating to Ba2 reflects the increases in debt and interest expense associated with the ongoing negotiation of the rated secured credit facilities and the unrated $400 million senior unsecured bridge loan, coupled with the depreciation of the Canadian dollar, the agency added.

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