S&P upgrades Grupo Mexico

Standard & Poor's said it raised its corporate credit rating on Grupo Mexico SA de CV to B+ from B-. The rating was removed from Creditwatch,

The outlook is stable.

"The two-notch upgrade on Grupo Mexico reflects the low debt level at the holding company, the expected cash flow generation from its stable railroad business (Ferromex), and the improved cash flow and ability of the mining business (AMC) to significantly reduce leverage," said S&P credit analyst Juan P. Becerra.

The rating on Grupo Mexico reflects the company's aggressive consolidated debt profile, cyclical and volatile copper price, and limited financial flexibility. These factors are balanced by the company's position as the third-largest copper producer in the world, including the very low cost mines of Southern Peru Copper Co., Americas Mining's better financial profile, and Ferromex's strong cash flow generation.

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