Moody's rates Localiza debentures Ba1

Moody's Investors Service's America Latina said it assigned a Ba1 global local-currency rating and a Aa2.br Brazilian national scale rating to Localiza Rent a Car SA's senior unsecured debentures due 2014.

The outlook is stable.

The ratings are supported by the company's "leading market position and strong brand in the Brazilian car rental market, its efficient and geographically extensive distribution network in Brazil, the benefits of its integrated business platform, its experienced management team, the liquidity of its assets and the positive fundamentals for the Brazilian car rental industry," Moody's analyst Soummo Mukherjee said in a written statement.

The company's Ba1 global local-currency and Aa2.br Brazilian national state ratings are constrained by the highly cyclical and capital-intensive nature of its business, the higher gross debt levels following the proposed debentures issuance, its small revenue amount, its lack of a significant international geographic footprint and its relatively weaker gross interest coverage ratios when compared with its peers.

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