Fitch may up Minera Mexico

Fitch Ratings said it placed the B local and foreign currency ratings of Minera Mexico SA de CV on Rating Watch positive. The company's secured export notes (SENs) and its guaranteed senior notes (Yankee bonds) that mature in 2008 and 2028 are affected by this rating action.

In conjunction with these rating actions, Fitch has placed the B- rating of Grupo Mexico SA de CV and the B rating of Americas Mining Corp. on Rating Watch positive. Fitch has also revised the outlook to positive from stable of the BB- foreign currency rating of Southern Peru Copper Corp. to reflect the recent change in the outlook of Peru's foreign currency rating.

Americas Mining Corp. is a wholly owned subsidiary of Grupo Mexico and is the direct parent company of Minera Mexico, Asarco Inc., and Southern Peru Copper.

S&P said Minera Mexico's credit profile has improved in 2004 due to the high price of copper and declining debt levels. During the first six months of 2004, the company has generated $338 million of EBITDA. This compares with only $193 million in all of 2003.

As a result of the strong free cash flow, the company's debt is expected to decline from $1.3 billion at the end of 2003 to about $1.0 billion at the end of 2004.

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