Moody's rates Saneouro debentures Ba2

Moody's Investors Service said it gave a Ba2 rating on the global scale and Aa3.br on Brazil's national scale to Ouro Preto Serviços de Saneamento SA’s (Saneouro) proposed R$100 million senior secured debentures due 2040.

“The Ba2/Aa3.br ratings reflect the terms of Saneouro's 35-year concession agreement effective January 2020 for the provision of water utility and sewage services in the municipality of Ouro Preto, Minas Gerais, the early stage of execution of construction works, and a highly leveraged capital structure. The debt tenor of 19 years is long for local standards and allows debt service coverage ratios (DSCR) to range between 1.20x - 1.25x throughout the debt term, considering the full budget of capital expenses, but translates to very slow deleveraging,” Moody’s said in a press release.

The outlook is stable.

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