S&P gives Magnesita BB

Standard & Poor's said it assigned its BB long-term corporate credit rating to Magnesita Refratários SA.

At the same time, S&P said it assigned its brAA- Brazil national-scale rating to the company.

The outlook is stable.

According to S&P, the rating on Magnesita reflects the exposure of the company's sales to cyclical industries and reliance on few customers, sizable gross debt, coming from the leveraged-buyout debt Magnesita recently assumed and the challenges for the company's new management to implement its strategic plans.

These risks are partly offset by Magnesita's leading business and market position in the local market of refractory products, privileged cost position and sound operating profile due to vertical integration into key raw materials and its broad variety of products and value-added services, ranging from elementary refractory products to tailor-made refractory solutions, the agency added.

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