S&P puts Marfa on watch

Standard & Poor's said it placed CFR Marfa SA's B long-term corporate credit rating on CreditWatch with negative implications, reflecting Marfa's weak liquidity position before the repayment of its €120 million eurobond due in December 2007.

The agency said that although Marfa has started refinancing negotiations with potential lenders and has received some refinancing commitments, these do not close the liquidity gap. Recent developments in international capital markets also contribute to S&P's concerns about Marfa's exposure to refinancing risk.

A downgrade is likely over the next three months if the company is not able to secure sufficient liquidity to repay the bond, the agency said.

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