S&P affirms CAP

Standard & Poor's said it affirmed its BBB- corporate credit rating on CAP SA and its BBB- rating on CAP SA's upcoming $200 million 7.375% fixed-rate bond due in 2036.

The outlook is stable.

The agency said that the BBB- ratings on CAP reflect its satisfactory business risk profile and intermediate financial risk profile, noting that the former is based on the company's strong competitive position as the sole integrated steel producer and its dominant market share in the small but growing Chilean steel market, as well as on its relatively large medium- and long-term export contracts for iron ore.

However, these strengths are partly offset by its small size on a global scale and the relatively low ore grade of its mining reserves, which result in a higher cost structure than that of its large competitors, S&P added.

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