Arauco Gets the Chop

S&P has cut Chile-based Celulosa Arauco y Constitucion (Arauco) to BBB from BBB+ based on the firm’s weaker-than-expected projected financial performance that it says will likely prevent the company reducing short-term leverage. “Nevertheless, we expect Arauco to continue to benefit from a very strong competitive position; a manageable, well-structured debt maturity profile; still-adequate credit measures; and very good access to refinancing,” says S&P. As of March 31, Arauco had about $2.7bn in financial debt. The total debt-to-Ebitda ratio is less than 3x.