Research Update: Brazilian Infrastructure Group Invepar Downgraded To 'D' From 'CCC-' On Distressed Debt Exchange

On Oct. 23, 2023, Invepar announced the restructuring of its third and fifth local debentures. We view the transaction as tantamount to default because not only it was done under distressed conditions, given Invepar's current fragile credit conditions, but also, in our view, creditors will receive less value than originally promised. As a result, on Oct. 25, 2023, S&P Global Ratings lowered its 'CCC-' global scale and 'brCCC-' national scale issuer credit ratings on Invepar to 'D'. We also lowered the debt ratings on its third and fifth debentures to 'D' from 'brC'. In addition, we removed the ratings from CreditWatch with negative implications. We will reevaluate Invepar's capital structure once the company concludes the debt negotiation of its subsidiary,

...- On Oct. 23, 2023, Invepar announced the restructuring of its third and fifth local debentures. - We view the transaction as tantamount to default because not only it was done under distressed conditions, given Invepar's current fragile credit conditions, but also, in our view, creditors will receive less value than originally promised. - As a result, on Oct. 25, 2023, S&P Global Ratings lowered its '###-' global scale and 'brCCC-' national scale issuer credit ratings on Invepar to 'D'. We also lowered the debt ratings on its third and fifth debentures to 'D' from 'brC'. In addition, we removed the ratings from CreditWatch with negative implications. - We will reevaluate Invepar's capital structure once the company concludes the debt negotiation of its subsidiary, BR-040 S.A. (Via 040), because Invepar guarantees this bank loan....

Research Update