S&P rates Embraer notes BBB

Standard & Poor's said it assigned a BBB rating to Embraer Overseas Ltd.'s proposed notes to be issued under a notes exchange offer, unconditionally guaranteed by Embraer SA.

The company plans to issue up to $990 million senior notes due 2023, of which up to $880 million will be used to exchange its 2017 and 2020 senior notes, S&P said, and the remaining $110 million will correspond to the premium on the exchanged bonds.

Embraer aims to improve its debt maturity profile, eliminating potential cash flow pressures from 2017 to 2020, which are critical years for the company's new projects as it rolls out its second generation E-jets, the agency said.

The final amount of the proposed notes is dependent on the acceptance of the exchange offer by current note holders, S&P said. The rating on the notes follows the rating on Embraer as the guarantor of the notes, the agency said.

The ratings reflect the company's strong operating performance and credit metrics as it maintains efficient operations and stable margins while developing its executive jet family and consolidating its line of commercial jets, S&P said.

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