S&P rates Mineral Logistics notes BBB-

S&P said it assigned a BBB- preliminary rating and negative outlook to Mineral Logistics’ proposed $483 million senior secured notes due August 2037.

The rating primarily reflects the credit quality of the offtaker, Vale International SA, S&P said.

The rating also incorporates the loan provided to Corporación Navios Sociedad Anonima (CNSA), which is the underlying asset supporting the repayment of the notes, S&P said.

The agency said it views CNSA as part of the project.

The key credit factor of the proposed transaction is the stable and predictable cash flows stemming the service agreement between CNSA and Vale International, which guarantees a minimum availability-based revenue stream until July 2037, the agency said.

The outlook is negative, reflecting a one-in-three chance of a downgrade due to a deterioration of Vale International's credit quality in the next 24 months, S&P said.

This will depend on the credit quality of the parent, Vale SA, which currently has a negative outlook, the agency said.

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