S&P cuts, rates InterCement Brasil notes CCC+

S&P said it lowered its global scale issuer credit and issue-level ratings on InterCement Brasil SA to CC from CCC, and its national scale rating on the company to brCC from brB-.

Concurrently, S&P rated the company’s planned secured notes CCC+ with a 2 recovery rating via InterCement Financial Operations BV.

InterCement is offering holders of its 2024 senior unsecured notes new senior secured notes due 2027, with a 15% haircut.

“The downgrade follows InterCement’s launch of an exchange offer to holders of its senior unsecured notes due 2024 for new senior secured notes. The exchange offer includes a haircut of 15%, while the new notes would mature in 2027 and have an interest PIK option until January 2022. In our view, this implies that investors will receive less value than the promise of the original securities, despite the higher interest on the notes,” S&P said in a press release.

The outlook is negative.

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