S&P rates Iochpe-Maxion, notes BB-

S&P said it gave Iochpe-Maxion SA and its planned seven-year senior unsecured notes BB- ratings. Subsidiaries Iochpe-Maxion Austria GmbH and Maxion Wheels de Mexico, S. de RL de CV will issue the notes. The recovery rating is 3, indicating substantial recovery (65%) in the event of default. The outlook is negative.

“We forecast Iochpe's revenues to grow about 20% in 2021, reflecting demand recovery in North America, advanced vaccination programs, and favorable momentum for commercial vehicles in all regions where the company operates. However, the negative outlook on the company still reflects the uncertainties about the auto industry's recovery given the effects of the Covid-19 pandemic, global economic downturn, and disruptions in the industry's supply chain that could delay the rise in the company's cash generation and pressure credit metrics,” S&P said in a press release.

The agency also affirmed its brAA+ national scale issuer and issue-level ratings on Iocphe. The 4 recovery rating on the senior unsecured debentures remains unchanged.

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