S&P puts Empresas CMPC on watch

Standard & Poor's said it placed its A- long-term corporate credit rating on Empresas CMPC SA and on its wholly owned subsidiary, Inversiones CMPC SA, on CreditWatch negative.

The CreditWatch listing follows CMPC's recent announcement that it has signed a memorandum of understanding for the acquisition of Guaiba, a business unit of Brazilian pulp and paper producer Aracruz Celulose e Papel SA (BB/negative/--) for about $1.4 billion.

"Although this acquisition will likely strengthen CMPC's asset and revenue base and its geographic diversification, it is also likely to result in significant additional debt and a reduction in CMPC's current cash position," said S&P credit analyst Luciano Gremone in a news release.

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