Moody Downgrades Chesapeake Energy into Junk Bond Territory

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From TheStreet:
Chesapeake Energy (CHK) bondholders have taken more hits than Rocky Balboa in recent weeks. 
On Friday, Moody's downgraded the Chesapeake Energy's corporate family rating three notches to B2 from Ba2. The move puts all of the Oklahoma-based oil and gas producer's debt further into of junk-bond territory. 
"The ratings downgrade reflects Chesapeake's persistently weak cash flow and the corresponding rising default risk," Pete Speer of Moody's said in the company's press release. "Industry conditions are increasingly challenging for Chesapeake to complete asset sales of the scale necessary to reduce debt to sustainable levels." 
Furthermore, the ratings agency assigned a B1 rating on the new senior secured second lien notes due 2022 that Chesapeake Energy announced on Wednesday. The rating on the notes is one notch above the company's broader rating to reflect the note's senior status compared to its unsecured notes, Moody's wrote.
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