Cemex ratings will continue to improve, analyst says

Cemex ratings will continue to improve, analyst says
Published: 01 September 2009

Standard & Poor’s (S&P) has reviewed its creditwatch on Cemex’s national and international ratings, upgrading them from developing to positive, S&P reported in a release.

It is likely the rating will be upgraded again in the near future, Mexico City-based financial group IXE analyst Patricio Rivera told BNamericas.

"With the recent refinancing and sale of assets in Australia, the company’s financial outlook has been improving in a stable manner and it’s likely that the rating will go up again in a couple of months," said Rivera.

S&P said it expects to resolve the creditwatch listing and raise the corporate credit rating to B once the company concludes a pending asset sale and proposed bond issue, which are currently in the regulatory and shareholder approval stages, respectively.

The ratings were originally placed on creditwatch on August 10.

The ratings hike came after Cemex announced the completion of its plans to refinance some US$15.5bn of outstanding debt, corresponding to syndicated and bilateral obligations.

The refinancing plan extends the maturities of these liabilities with approximately 75 banks and private placement note holders, providing for a semi-annual amortization schedule, with a final maturity of February 14, 2014.

Global net debt at the end of the second quarter totaled US$18.3bn, representing an increase of US$238m during Q2, according to the company’s website.