S&P rates Loma Negra notes BB

Standard & Poor's said it assigned a B local and foreign corporate credit rating to Argentina-based Loma Negra CIASA and a BB senior unsecured debt rating to the forthcoming $100 million notes due 2013 to be issued by Loma Negra and fully, unconditionally and irrevocably guaranteed by its shareholder, Camargo Correa Cimentos SA (BB/stable). The outlook is stable.

Proceeds from the issuance will be used to refinance part of Loma Negra's debt and to fund some capital expenditures in Argentina. Debt to EBITDA was 1.3x for the 12 months ended November.

S&P said the corporate credit rating on Loma Negra reflects the company's exposure to the swings in economic activity in Argentina and the inherent volatility of the cement industry, limited product and geographic diversification and currency mismatch risks.

These factors are partially mitigated by the company's good market position as the largest cement producer in Argentina, competitive cost position and healthy financial situation due to the significant debt amortizations after the restructuring taken in 2003 and better economic conditions, the agency said.

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