S&P rates Kansas City Southern de Mexico notes BB-

Standard & Poor's said it assigned a BB- rating to Kansas City Southern de Mexico SA de CV's proposed $185 million senior unsecured notes due 2020.

The corporate credit rating is BB- for the issuer and its parent Kansas City Southern.

The outlook is stable.

Proceeds will be used to pay off the 7 5/8% notes due 2013 and 12½% notes due 2016.

Ratings reflect the company's aggressive financial risk profile, capital intensity and meaningful exposure to cyclical end markets such as automotive and manufacturing, particularly in Mexico through its subsidiary, which Kansas City Southern acquired in April 2005, the agency said.

The favorable characteristics of the U.S. freight railroad industry and the company's strategically located rail network partly offset these risks, the agency noted.

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