Moody's rates Codelco notes A2

Moody's Investors Service said it assigned an A2 foreign currency rating to Corporacion Nacional del Cobre de Chile's (Codelco) $500 million private placement note issue due 2014.

The outlook is stable.

Proceeds will be used to refinance about $300 million of debt with the balance used to partially finance capital expenditures.

Moody's said the A2 foreign currency rating reflects Codelco's strength and position in the global copper markets, its operational efficiency and its earnings and cash generating power given its production volumes. The A2 foreign currency rating not only reflects the operating strengths of Codelco but also incorporates the element of convertibility risk, or the likelihood that the Chilean government might declare a general debt moratorium to counter a foreign currency crisis.

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