BANGALORE (Thomson Financial) - Fitch Ratings revised the outlook on its
national scale rating on Brazil's third-largest iron ore miner Samarco Mineracao
SA. to positive from stable, saying the action reflects Samarco's strong
financial profile and solid ownership structure comprising two industry-leading
parent companies.
The ratings also consider Samarco's favorable competitive position as
low-cost producer and exporter of iron ore pellets, as well as the positive
outlook for the iron ore industry over the near- to medium-term.
The agency also affirmed Samarco's foreign currency issuer default rating
and local currency IDR at 'BBB' and its national scale rating at 'AA+'(bra). The
outlook on the IDRs is stable.
In 2008, Fitch expects the company to generate export revenues of about $3.0
billion and operating EBITDA of close to $1.5 billion from the sale of about 20
million tons of pellets. Further, the rating agency believes Samarco's two
shareholders, with combined operating EBITDA in 2007 of close to $30 billion,
would support the company in the event of a sovereign-related liquidity crisis.
Companhia Vale do Rio Doce, the world's largest iron ore producer and
exporter, jointly controls Samarco with BHP Billiton Ltd. in Brazil.
TFN.newsdesk@thomson.com
jjo/jro
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