Fitch rates CAP bond BBB-

Fitch Ratings said it assigned BBB- foreign- and local-currency issuer default ratings to Chile-based CAP SA and a BBB- rating to the company's proposed $200 million bond issue.

The outlook is stable.

Fitch said the ratings are supported by the company's dominant presence in the Chilean steel industry, the favorable outlook for its iron ore business and moderate financial leverage. Further factored into the ratings are CAP's long-term relationships with both its steel and iron ore clients.

Balanced against these credit strengths are the volatile nature of the steel industry in terms of prices and volumes, rising production costs for the company's steel business and a relatively aggressive capital expenditure program, the agency said.

During 2005, CAP generated $255 million of adjusted operating EBITDA. The company had $375 million of debt at June 30.

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