Moody's downs Windsor

Moody's Investors Service has taken a red pen to Windsor Petroleum Transport's debt rating.

In response to the Independent Tankers Corp subsidiary's Chapter 11 bankruptcy filing, the agency downgraded the company's 7.84% term secured notes rating to "Ca" from "Caa2".

"The downgrade of [Windsor Petroleum's] term notes rating to Ca reflects Moody's expectation that the recovery rate on the term notes will range between 35% to 65% based on a market assessment of its assets," Moody's told clients Wednesday.

The firm, which noted the revision applies to approximately $188.6m worth of debt, pointed out that it intends to withdraw Windsor Petroleum's ratings altogether.

Industry observers, including a leading bond analyst, note it's not uncommon for Moody's and other ratings agencies to pull the plug when issuers file for bankruptcy protection.

According to documents filed in the US Bankruptcy Court for the District of Delaware, Windsor Petroleum submitted a request for a Chapter 11 restructuring on Monday.

At the time the debtor, which is represented by attorneys from Young, Conaway, Stargatt & Taylor, listed assets of less than $50,000 and liabilities between $100 and $500m.

In addition to the holders of bond and bank debt Windsor Petroleum pointed out that Frontline Ltd is among its largest creditors with a claim of approximately $1.4m.

Today the petitioner oversees four VLCCs: the 306,000-dwt British Pioneer (built 1999), and the 306,000-dwtBritish PurposeBritish Progress and British Pride (all built 2000)., a valuation portal operated by a leading UK sale-and-purchase broker, believes the vessels are worth approximately $107.1m in total in today's market.