Fitch ups USJ Acucar, rates notes CCC-

Fitch Ratings said it upgraded USJ Acucar e Alcool SA's long-term foreign and local currency issuer default ratings to CCC- from RD and the national scale rating to CCC(bra) from RD(bra).

Fitch also upgraded USJ's currently outstanding $4 million senior secured notes due 2021 and $8.7 million senior unsecured notes due 2019 to CCC-/RR4 from C/RR4.

At the same time, Fitch assigned a CCC-/RR4 rating to the newly issued senior secured notes due 2023.

The agency said the upgrade follows the conclusion of the debt exchange offer of USJ's outstanding 9 7/8% senior unsecured notes due 2019 and 9 7/8%/12% senior secured PIK toggle notes due 2021 for newly issued 8˝%/9 7/8% senior secured PIK notes due 2023.

Fitch said that the debt renegotiation brings only a temporary relief to USJ's persistently high refinancing risks.

“USJ's capital structure remains unsustainable and, in the absence of any material asset sales, the company will continue to face very limited financial flexibility to face debt obligations up to 2021,” Fitch said in a news release.

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