Moody's: Intcomex outlook negative

Moody's Investors Service said it changed Intcomex, Inc.'s outlook to negative from stable, downgraded the company's probability-of-default rating to Caa1 from B3, speculative grade liquidity rating to SGL-4 from SGL-3 and $120 Million of 11¾% of second-lien secured notes to B3 (LGD3, 36%) from B3 (LGD3, 48%).

Intcomex's corporate family rating was affirmed at B3.

The outlook change reflects the company's weaker than expected financial performance resulting in tight cushions for the financial maintenance covenants under the company's bank credit agreement resulting in a weaker liquidity position and reduced financial flexibility due to shortened maturity of the revolving credit facility.

Intcomex's B3 CFR is constrained by the company's high debt leverage, weak liquidity profile, expectation of limited free cash flow generation, meaningful debt maturity profile over the near to medium-term, company's moderate exposure to credit risk and geographic concentration as, the agency said.

The rating also considers Intcomex's good market position and diversified customer and country base in Latin America and the Caribbean markets, good revenue growth over the past several years and moderate barriers to entry in certain of its markets, the agency said.

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