Fitch Upgrades Rodonorte Debentures

Fitch has raised the local scale rating on BRL85m debentures due in 2010 of Brazil’s Rodonorte A- from BBB+. The upgrade reflects the strengthening of Rodonorte’s financial profile, the agency says, and factors in reduced political risk due to a more reliable regulatory environment. “The latter factor should allow the company to implement tariff readjustments on the date scheduled by the concession contract, reducing potential pressures on its cash flow,” Fitch says. The rating is also bolstered by a guarantee structure, which considers the pledge of revenues and assignment of potential indemnities received. Rodonorte is the concessionaire for 560km of highways, 480km of toll highways and 80km of access stretches in the Brazilian state of Parana.