Fitch lowers Grupo Posadas

Fitch Ratings said it downgraded Grupo Posadas SAB de CV's ratings, including the local currency issuer default rating to B- from B, the foreign currency IDR to B- from B, the national scale rating to B+(mex) from BB+(mex), the $200 million senior notes due 2015 to B-/RR4 from B/RR4 and the Ps. 2.25 billion Certificados Bursatiles issuance Posadas08 to B+(mex) from BB+(mex).

In addition, the ratings were placed on Rating Watch negative.

Fitch said the downgrade reflects Posadas' continued high leverage and heightened refinancing risk toward 2013. The approved equity increase in the form of convertible debentures for Ps. 900 million and the unwinding of some of its hedges should ease liquidity concerns during 2012 but leverage should remain high.

Total adjusted debt to EBITDAR ended 2011 at 6.8 times and 5.9x after excluding a non-recurrent non-cash charge of Ps. 183 million.

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