Mexico-based auto supplier Nemak will fund its planned acquisition of GF Casting Solutions with debt, raising its adjusted debt to EBITDA to 2.7x during 2025, from the 2.3x previously expected by S&P Global Ratings. Although we believe synergies from the acquisition will boost Nemak's top-line growth, we forecast that adjusted leverage and cash generation will remain constrained, at least in the next 12-18 months. On Aug. 4, 2025, S&P Global Ratings affirmed its long-term global scale 'BB+' and national scale 'mxAA-' issuer credit ratings on Nemak and the 'BB+' issue-level rating on Nemak's sustainability-linked bonds due 2028 and 2031. The recovery rating remains '3' (50%). The negative outlook reflects the potential for a downgrade if operating performance and cash flow
