Moody's assigns Grupo Bimbo notes Baa2

Moody's Investors Service said it assigned a Baa2 global local-currency bond rating and Aa1.mx national scale rating to Grupo Bimbo, SAB de CV's proposed senior unsecured fixed-rate certificados bursatiles due 2019 and floating-rate certificados bursatiles due 2017.

The certificados bursatiles will not exceed Ps. 7.5 billion in the aggregate.

The outlook is stable.

The issuances will be guaranteed by Bimbo, SA de CV, Barcel, SA de CV, Bimbo Bakeries USA, Inc. and Bimbo Foods, Inc.

The proceeds will be used to refinance existing debt.

Grupo Bimbo has a long-term issuer domestic-currency rating of Baa2, senior unsecured domestic- and foreign-currency ratings of Baa2, senior unsecured medium-term note program domestic-currency ratings of provisional Baa2, senior unsecured domestic-currency ratings of Aa1.mx, senior unsecured medium-term note program domestic-currency ratings of Aa1.mx.

The ratings are supported by Bimbo's position as the largest baked-goods company in Mexico and in the United States after the acquisition of Sara Lee's North American fresh bakery business with an ample distribution infrastructure in its key markets, Moody's said.

The ratings also consider its sustained free cash flow generation, geographic diversification, experienced management team and prudent financial policies, the agency said.

These credit positives are partly offset by the competitive nature of its markets and the volatility of results in its Latin American operations, Moody's said.

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