S&P gives Tallgrass notes BB-

S&P said it assigned a BB- issue-level rating and 2 recovery rating to Tallgrass Energy Partners LP’s new senior unsecured notes. The 2 recovery rating indicates expectations for substantial (70%-90%; rounded estimate: 85%) recovery in the event of a payment default.

The rating is in line with Tallgrass’ senior unsecured debt, S&P said.

Tallgrass will use the proceeds to repay revolver borrowings.

“Our view of Tallgrass’ credit metrics and financial risk remain unchanged,” the agency said in a press release.

In a related matter, the agency downgraded Prairie ECI Acquiror LP’s senior secured debt to B- from B, given the additional priority debt at Tallgrass, which will diminish the value available to the holdco lenders in a default scenario. S&P also revised the recovery rating on the secured debt to 6 (rounded estimate: 0%) from 5.

The outlook for both companies is stable.

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