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Distressed Debt Exchange for Boart Longyear

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On September 1, 2017, S&P Global Ratings lowered its corporate credit rating on Boart Longyear Limited to SD from CC, its senior secured notes due 2018 to D from CCC- and its senior unsecured notes due 2021 to D from C. According to S&P Global, the downgrade follows Boart Longyear’s announcement that it has completed an exchange offer in which $196 million of the Company’s 7% senior unsecured notes due 2021 are converted into common equity. S&P views this as a distressed transaction because there is a realistic possibility of a conventional default without the transaction and participating noteholders received less than the original amount promised. At the same time, the Company reinstated the senior secured notes due 2018 at approximately $200 million, plus accrued interest. The senior secured notes now expire December 2022 and Boart has the option to pay payment-in-kind (PIK) interest for the first four quarters. Read more on distressed companies.