S&P downgrades Idesa

S&P said it lowered the issuer credit rating on Grupo Idesa SA de CV (Idesa) to CCC from CCC+, and lowered the rating on the company's senior unsecured notes to CCC from CCC+.

The recovery rating on the notes remains unchanged at 4.

Idesa's operational and financial performance has continued to weaken, leading to extremely high debt of more than 10x and EBITDA interest coverage of less than 1x, S&P said.

Without a timely refinancing, the agency said it believes there is heightened risk of a liquidity shortfall and an increased possibility of potential debt restructuring.

The negative outlook reflects increased risk of a debt refinancing over the next six months unless financial performance significantly improves, S&P said.

The downgrades also consider the increased likelihood that Idesa could default within the next 12 months, unless there's an unexpected positive development that could mitigate the company's high refinancing risk, the agency said.

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