S&P ups Gerdau

Standard & Poor's said it raised its corporate credit rating on Gerdau SA to BBB- from BB+ and removed it from CreditWatch, where it was placed with positive implications on March 19.

The rating on Gerdau's $600 million perpetual notes was also raised to BBB-, the agency said.

The outlook on the corporate credit rating is stable.

The rating action reflects Gerdau's improving business and financial profiles, supported by the strengthening of the company's operation in North America (Gerdau Ameristeel Corp., BB+/stable), a more stable and benign domestic environment in its home country of Brazil, stronger market positioning in Latin America and gradual business diversification into specialty steel, S&P noted.

The ratings also reflect the company's adequate geographic diversification through the Americas and an expanding specialty steel business, with very strong and growing market shares in Brazil and North America, an improved and sustainable financial profile and the increasing profitability of its North American operation, the agency said.

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