Standard & Poor's has bumped its corporate credit rating for the exploration and production company down to SD from 'B-'. It also downgraded its existing debt.
Vantage Drilling, tied to an alleged bribery incident involving one of its agents and Brazilian state-owned oil company Petrobras, saw prices on its first-lien loans and high-yield bonds take a nosedive in secondary market trading Wednesday.
The U.S. high yield bond market had its worst performance last month since September 2014, according to Standard & Poors.
Of 278 issues being monitored by Standard & Poor's for their distressed standing, 95 are in the oil and gas sector and 45 are in metals/mining.
The exploration and production company has been bumped down to 'SD' from 'B-' by Standard & Poor's. It's unsecured debt ratings have also been revised to 'D' from 'CCC'.
Investors removed more than $1.6 billion from junk bond mutual funds and ETFS. Their bank loan counterparts saw net withdrawals totaling $796 million.
An ample reserve of $1.8 billion in cash and short-term investment liquidity is expected to be the source of funding of DaVita's $415 million acquisition of Renal Ventures.
While the equity market selloff is certainly unnerving, participants have been debating how much bad news is already priced into debt markets; JP Morgan still sees positive full-year returns.
Three issuers -- Townsquare Media, wrapped up loan transactions Friday to close a week in which only seven loans priced, according to reports.
The tender offer will be partially funded by the company's $240 million sale of its electronics departments in the U.S. and U.K.
Firm: Guggenheim Securities
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