Fitch rates FS Agrisolutions BB-

Fitch Ratings said it gave FS Agrisolutions Industria de Biocombustiveis BB- long-term local- and foreign-currency issuer default ratings and an A+(bra) national long-term rating.

Fitch also assigned a BB- rating on the proposed senior secured notes issued by fully-owned FS Luxembourg Sarl. The notes will be benchmark size with a bullet maturity of five years and guaranteed by the parent.

“The ratings incorporate FS’ large scale operations and low cash cost of production in the volatile Brazilian ethanol industry. The ratings consider the high volatility of Brazil’s corn and ethanol prices, and the lack of meaningful price correlation between these two commodities, which add risk to FS’ profitability and cash flow,” Fitch said in a press release.

Fitch also assumes proceeds will be used to prepay the company’s $490 million secured U.S. dollar-denominated debt, releasing assets from the existing collateral package.

The outlook is stable.

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