Fitch rates Bimbo notes BBB

Fitch Ratings said it assigned a BBB rating to Grupo Bimbo, SAB de CV's proposed $500 million senior notes issuance due 2020.

The company's foreign- and local-currency issuer default ratings are BBB and its national scale long-term rating is AA+(mex).

The outlook is positive.

Proceeds will be used to refinance existing debt and for general corporate purposes.

Bimbo's ratings are based on the company's leadership position in the global bakery business, strong brand recognition and positioning, the agency said.

Ratings also incorporate its improved business profile and geographic diversification, Fitch said.

Ratings also consider the strengthening of the company's financial profile, supported by the successful integration of the Weston Foods acquisition, good operating results over the past 12 months, important reduction in debt levels and a better liquidity position, the agency noted.

The positive outlook reflects expectation that Bimbo will continue with its deleveraging strategy in the near-to-medium term and that it will reach its total debt-to-EBITDA ratio target of 1.5 times over the next 18 months, supported by significant cash generation, Fitch said.

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