Pn July 7, 2017, Moody’s Investors Service downgraded Imperial Metals Corporation’s corporate family rating to Caa2 from Caa1, probability of default rating to Caa2-PD from Caa1-PD and senior unsecured debt rating to Caa3 from Caa2. “The downgrade and negative outlook reflect Imperial’s announcement that production will not meet its guidance, it will breach bank covenants, require additional financing and it will review strategic alternatives,” said Jamie Koutsoukis, Moody’s vice-president.
On July 7, 2017, S&P Global Ratings lowered its long-term corporate credit rating on Imperial Metals Corporation to CCC- from CCC and its senior unsecured notes rating to CC from CCC-. According to S&P Global, the downgrade follows Imperial’s announcement that it will breach some financial covenants under its senior credit facility and require additional liquidity to remain a going concern. In S&P’s view, it is likely Imperial will consider a distressed debt exchange within the next six months. Read more on distressed companies.