Research Update: Brazilian Infrastructure Group Invepar Downgraded To 'CCC', Rating On CreditWatch Negative On Risks Of Debt Acceleration

The devolution of the BR-040 S.A. (Via 040) concession triggered an early prepayment clause of Invepar's third debentures, and since Aug. 5, 2024, Invepar has been soliciting temporary waivers from its creditors. We believe creditors may not have full incentives to accelerate the debt because it would take longer to recover their debt in case Invepar enters a judicial recovery proceeding. In addition, the ruling of Linha Amarela S.A. (Lamsa)'s judicial dispute is ongoing, and there is a risk of concession termination if the Federal Supreme Court decides that it doesn't have authority to analyze the expropriation of the concession. Under this scenario, we anticipate that Invepar wouldn't be able to pay its debentures. S&P Global Ratings therefore lowered its

...- The devolution of the BR-040 S.A. (Via 040) concession triggered an early prepayment clause of Invepar's third debentures, and since Aug. 5, 2024, Invepar has been soliciting temporary waivers from its creditors. - We believe creditors may not have full incentives to accelerate the debt because it would take longer to recover their debt in case Invepar enters a judicial recovery proceeding. - In addition, the ruling of Linha Amarela S.A. (Lamsa)'s judicial dispute is ongoing, and there is a risk of concession termination if the Federal Supreme Court decides that it doesn't have authority to analyze the expropriation of the concession. Under this scenario, we anticipate that Invepar wouldn't be able to pay its debentures. - S&P Global Ratings therefore lowered its global scale issuer credit rating on Invepar to '###' from '###+' and the national scale rating to 'brB-' from 'brBB-'. We also lowered the issue-level ratings on Invepar's third and fifth debentures to 'brCCC' from 'brB' and...

Research Update