Fitch Ratings upgraded Summit Midstream Corporation’s long-term issuer default rating to 'B' from 'B-' on Friday, citing sustained improvements in financial strength and a stable outlook.
The agency also raised the second-lien secured notes to 'BB-' from 'B+', maintaining a recovery rating of 'RR2', which corresponds to an expected recovery range of 71% to 90% in the event of default. Summit Midstream Holdings, LLC received an identical rating action.
Fitch projected Summit’s leverage will remain between 4.8x and 4.3x through its forecast horizon, compared with the company’s long-term target of 3.5x. Interest coverage is expected to stabilize around 2.7x to 3.0x. Run-rate EBITDA, excluding the Double E acquisition, is forecast at $200 million to $250 million, with over 85% derived from long-term, fixed-fee, acreage-dedicated contracts.
The weighted average remaining contract term exceeds seven years, and less than 5% of contracts—excluding Double E—include minimum volume commitments. Fitch estimated going-concern value using a 6.0x EBITDA multiple applied to approximately $195 million in projected EBITDA, while administrative claims were assumed at 10% and an 80% drawn asset-based lending facility.
Summit reduced debt in 2024 using proceeds from asset sales and opportunistic issuance, easing its maturity profile. Volume throughput across its systems increased in the second quarter of 2026, with potential for further growth if commodity prices remain supportive. The company has also pursued strategic bolt-on mergers and acquisitions in recent months, financing deals with a mix of cash and equity.
