Fitch rates Compass Gas

Fitch Ratings said it assigned Compass Gas e Energia SA first-time foreign-currency and local-currency issuer default ratings of BB and BB+, respectively, and a long-term national scale rating of AAA(bra).

The outlook for the foreign-currency IDR is negative, while the outlook for the local-currency IDR and the national scale rating is stable.

“Compass' ratings reflect the linkage with its parent Cosan SA (Cosan; FC IDR BB/negative; LC IDR BB+/stable; national scale rating AAA(bra)/stable) and that company's stronger stand-alone credit profile (SCP). The application of Fitch's parent and subsidiary linkage rating criteria has resulted in the equalization of Compass' ratings with those of Cosan. Cosan owns 88% of Compass, and has open access to Compass' assets because of the absence of legal ring-fencing between the two companies,” Fitch said in a press release.

Compass also guarantees R$700 million debt at a subsidiary level and Fitch said the company may raise debt soon.

The foreign-currency outlook is tied to the negative outlook for the Brazilian sovereign rating, the agency said.

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