S&P stabilizes Unacem outlook

S&P said it revised its outlook for Unacem Corp. SAA to stable from positive and affirmed its BB issuer credit rating.

The company bought a cement plant in Tehachapi, Calif. for $315 million using a three-year $345 million syndicated bank loan.

“We now expect Unacem to maintain a tighter liquidity position and refinance short-term debt maturities beyond what we previously expected. However, we think the company maintains good access to capital markets and sound relationships with several banks, as reflected in the syndicated bank loan secured for the Tehachapi acquisition,” S&P said in a press release.

The agency said it now estimates Unacem’s net debt to EBITDA for 2023 will be 3.7x-3.8x, but on a pro forma basis, considering 12 months of Tehachapi operations, it would likely be 3.1x-3.2x.

“We estimate leverage will fall below 3x by year-end 2024, due to a quick integration of the recently acquired assets, including the Termochilca plant earlier this year, along with a modest improvement in the Peruvian operations' sales and profitability after weaker performance–though better than the total Peruvian market–in 2023,” S&P said.

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