Moody's: Braskem notes Baa3

Moody's Investors Service said it assigned a Baa3 foreign-currency rating with stable outlook to the up to $750 million of senior notes due 2021 to be issued by Braskem Finance Ltd. (Cayman Islands) and fully and unconditionally guaranteed by Braskem SA.

The proposed notes issuance is part of Braskem's liability management strategy and will not increase its leverage as the net proceeds will be entirely used to refinance existing debt, consequently improving its debt maturity profile, the agency said.

The rating of the proposed notes is not constrained by Brazil's Baa2 foreign-currency country ceiling, the agency added.

Braskem's Baa3 rating is supported by its large size as the largest petrochemical company in Brazil and in the Americas by production capacity, with above industry average operating margins that result from historically high capacity utilization rates, long-term client relationships and product customization, the agency said.

The rating also factors in the company's exposure to volatile naphtha and natural gas prices and its dependence on Petrobras for the supply of those inputs, the agency added.

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