S&P affirms Lima Airport Partner

Standard & Poor's said it affirmed the BBB- long-term senior secured debt rating on Lima Airport Partner SRL's $165 million of fixed-rate notes, following the recent upgrade of the Republic of Peru.

The agency said it raised the long-term foreign-currency rating on the Republic of Peru to BBB- from BB+ and raised the long-term local-currency rating to BBB+ from BBB-.

S&P said the upgrade is supported by the significant decline in Peru's fiscal and external vulnerabilities amid diversifying sources of growth with low inflation and strengthening macroeconomic fundamentals.

The rating reflects the good asset quality of the company's sole operating entity, Jorge Chavez International Airport, its strong competitive position and expected strong credit metrics, according to the agency.

These strengths are offset by an untested regulatory framework, a somewhat aggressive use of financial debt relative to country risk and pending negotiations with the government, S&P said.

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