S&P rates Inversiones CMPC notes BBB

Standard & Poor's said it assigned a BBB debt rating to Inversiones CMPC SA's proposed 10-year senior unsecured notes for up to $500 million.

Inversiones CMPC is a wholly-owned subsidiary of Empresas CMPC SA and acts as a financing vehicle for foreign-bonds issuances.

CMPC fully and unconditionally guarantees the notes. The agency said it expects the company to use most of the proceeds to refinance existing debt and fund investments.

The ratings reflect the company's satisfactory business risk profile and intermediate financial risk profile, S&P said.

Major factors include the company's geographic diversification, its efficient cost structure relative to its European and North American peers and solid position in Latin American tissue markets, the agency said.

CMPC's financial profile is characterized by adequate liquidity and ample operating cash flow generation, S&P said.

Its debt is at peak levels and is likely to remain somewhat high for the rating category through 2015, following the company's decision to invest in a new pulp mill, the agency said.

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