Fitch downgrades Vitro

Fitch Ratings said it downgraded Vitro, SAB de CV's long-term issuer default rating and local-currency issuer default rating to CC from B-; its $300 million senior notes due 2012, $225 million senior notes due 2013 and $700 million senior notes due 2017 to CC/RR4 from B-/RR4; and its national scale long-term rating and Certificados Bursatiles due 2009 and 2011 to CC(mex) from BB(mex).

All ratings remain on Rating Watch negative.

The agency said the downgrade reflects Vitro's limited financial flexibility given the current economic environment and its weaker ability to meet its financial obligations on time. And Vitro continues to negotiate with its derivative instruments counterparts, which Fitch said could translate into increased leverage and represents additional pressure on the timely payment of the company's financial obligations.

The continued Rating Watch negative reflects Vitro's increased difficulty in strengthening its liquidity position in light of current credit markets conditions, the agency said.

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