Fitch lowers Impsa, WPEI

Fitch Ratings said it downgraded the foreign and local currency issuer default ratings of Industrias Metalurgicas Pescarmona SAIC y F (Impsa) and WPE International Cooperatief UA (WPEI) to CCC from B+.

These actions affect Impsa's $225 million senior unsecured international bonds due October 2014 and WPEI's $390 million senior unsecured international bonds due September 2020. The bonds' ratings are being downgraded to CCC/RR4 from B+/RR4.

In addition, given the reorganization of the issuers' organizational structure, Fitch is assigning a new rating of CCC for Venti SA, the group's ultimate holding company that acts as guarantor of the Impsa and WPEI notes.

The ratings for Impsa and WPEI were placed on rating watch negative. For Venti, the local and foreign currency long-term issuer default rating of CCC was also placed on rating watch negative.

Fitch said the downgrade reflects the company's stretched liquidity. At the Impsa level, which encompasses the company's Argentina business, the company's cash and marketable securities were equivalent to $28 million as of year-end 2013 versus short-term debt obligations of $411 million or 7% of short-term obligations. As of the 2013 first quarter, cash and marketable securities declined to $16 million while short-term debt obligations of $406 million means cash and equivalents declined to 4% as a percentage of short-term debt.

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