Fitch rates Latam notes B+

Fitch Ratings said it assigned an expected rating of B+ with recovery rating of RR4 to Latam Airlines Group SA's proposed unsecured notes to be issued through its fully owned subsidiary, Latam Finance Ltd.

The notes will be fully guaranteed by Latam, Fitch said.

The target amount for the proposed transaction is in the $500 million to $750 million range.

The total amount and tenor for the proposed issuance will depend on market conditions.

The proceeds from the proposed issuance will be used primarily to refinance debt and for general corporate purposes, Fitch said.

The company has a long-term issuer default rating of B+ with a stable outlook.

The ratings and stable outlook reflect expectations that improvement in the company's credit metrics will continue during 2017, Fitch said.

The ratings are supported by its diversified business model, important regional market position and adequate liquidity, the agency said.

These positive factors are tempered by the company's still high gross adjusted leverage and operational volatility related to some key markets, Fitch said.

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