Moody’s cuts Automotores Gildemeister

Moody’s Investors Service said it downgraded Automotores Gildemeister SA’s corporate family rating to Caa3 from Caa2 and its senior unsecured notes ratings to Ca from Caa3.

The downgrades mirror the company’s weak liquidity profile and overall capital structure, which in turn weakens financial flexibility and the ability to service debt obligations due in the next 12 months.

The downgrades also consider the uncertainty over the speed of the recovery of operations in the automobile retail industry in Chile and Peru, which are the company’s main markets.

The senior unsecured notes’ CA rating stands a notch below the company’s Caa3 and reflects the subordination of these unsecured notes to Automotores Gildemeister’s other secured debt.

The outlook is stable.

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