OGX Unlikely to Make Interest Payment: S&P

OGX Unlikely to Make Interest Payment: S&P

Brazil Corporate & Sovereign Strategy

OGX will likely not have enough cash to make upcoming interest payments, S&P says as it downgrades the Eike Batista-controlled oil producer to CCC minus from CCC. Liquidity is weak, and a cash position of $326m means sources will cover uses by less than 1.0x this year. “The next interest payments on OGX's outstanding bonds are due in October 2013 for about $45m and December 2013 for about $110m. We believe the company’s cash sources will not be sufficient to cover these commitments,” S&P says. B

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