Research Update: Brazilian Infrastructure Company Invepar Downgraded To 'CCC-' And 'brCCC-' On Rising Refinancing Risks, Outlook Negative

Brazil-based transportation infrastructure group Investimentos e Participacoes em Infraestrutura S.A. – Invepar has R$1.37 billion in debt maturing in April 2021, and we believe that the company will struggle to refinance it. Invepar has limited financial flexibility, given its cash position is insufficient to amortize the existing debt, while performance of most of its assets suffered because of the social-distancing measures due to the COVID-19 pandemic, reducing their ability to upstream dividends. In addition, the company is disputing a recent ruling from the Superior Court of Justice that authorizes the city of Rio de Janeiro to revoke the concession of Linha Amarela S.A. (LAMSA), posing additional uncertainty over Invepar's future cash flows. On Sept. 25, 2020, S&P Global Ratings lowered

... Investimentos e Participacoes em Infraestrutura S.A. ¡ Invepar has R$1.37 billion in debt maturing in April 2021, and we believe that the company will struggle to refinance it. - Invepar has limited financial flexibility, given its cash position is insufficient to amortize the existing debt, while performance of most of its assets suffered because of the social-distancing measures due to the COVID-19 pandemic, reducing their ability to upstream dividends. - In addition, the company is disputing a recent ruling from the Superior Court of Justice that authorizes the city of Rio de Janeiro to revoke the concession of Linha Amarela S.A. (LAMSA), posing additional uncertainty over Invepar's future cash flows. - On Sept. 25, 2020, S&P Global Ratings lowered its global scale issuer credit rating on Invepar to '###-' from '###' and the Brazil national scale rating to 'brCCC-' from 'brB-'. We also lowered our issue-level rating on the company's...

Research Update