Hurricane Hydrocarbons' Corp Credit Rating Cut By S&P
Dow Jones Newswires
TORONTO -- Standard & Poor's Tuesday said it downgraded Hurricane
Hydrocarbons Ltd.'s corporate credit and senior unsecured debt ratings to triple-'C'-minus from single-'B'-minus, and placed the company on CreditWatch with developing implications. Developing means ratings may be raised, lowered, or affirmed.
The downgrade follows Hurricane's statement that it will be unable to meet wage and other payment obligations, which highlights a deteriorating liquidity position. Hurricane's inability to meet its short-term payment obligations "negates earlier expectations based on the favorable resolution of pricing disputes with the Skymkent refinery in 1998 and cost-cutting measures put into effect at the beginning of 1999," Standard & Poor's said. "Furthermore, the liquidity crisis highlighted by the deferral of the company's short-term obligations may extend to an inability to make interest payments on long-term debt obligations as they come due during the year."
Thought you might enjoy this, from today's WSJ. S&P must have read your note from 4/2. And another, with some more detail:
Hurricane Hydro: Some Oper Expenses, Incl Wages, In Arrears
Dow Jones Newswires
CALGARY -- Hurricane Hydrocarbons Ltd. (HHLAF) said some of its operating expenses, including wages, are in arrears due to "severe cash flow constraints" caused by continued low prices and demand for petroleum products in southeast Kazakstan.
In a news release, Hurricane said it has taken steps to reduce costs, defer expenditures and reschedule payments.
It said it's also "advancing" discussions with prospective strategic and financial partners, and has hired Nesbitt Burns Inc. as its financial adviser for these talks.
In early March, the company ended a previous agreement with adviser Donaldson, Lufkin & Jenrette, but said it was still in talks for a prosposed range of transactions, including combining business interests, making a significant investment in Hurricane and acquiring non-core company assets.
The company also said Werner J. M. Wenzel has resigned from the board.
Hurricane Hydro is an oil and gas company operating in Kazakstan
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