Fitch affirms Arcos Dorados

Fitch Ratings said it affirmed Arcos Dorados BV's foreign-currency issuer default rating at BBB- and local-currency issuer default rating at BBB-, along with the BBB- rating on its $450 million senior unsecured notes due 2019.

The agency also said it affirmed Arcos Dorados Holdings Inc.'s foreign-currency issuer default rating at BBB- and the BBB- rating on its R$675 million senior unsecured Brazilian-real notes due 2016.

The 2019 notes issued by Arcos Dorados are guaranteed jointly and severally, unconditionally and irrevocably by all relevant subsidiaries, while the 2016 notes issued by Arcos Dorados Holdings are fully and unconditionally guaranteed by Arcos Dorados and relevant operating companies.

The outlook is stable.

The ratings consider the company's solid consolidated financial profile with moderate leverage and most of its cash flow generation concentrated in investment-grade countries, Fitch said.

The ratings also consider the company's geographic diversification and business strength as the largest McDonald's franchisee in the world with operations in 20 countries in Latin America, the strength of McDonald's as franchisor and its longstanding relationship with Arcos' owners and management, the agency said.

The ratings also reflect concerns about the company's aggressive expansion plan, Fitch added.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.