Fitch: Braskem's Ratings Unchanged Upon Asset Sale

RIO DE JANEIRO--()--Fitch Ratings views Braskem S.A.'s (Braskem) recent announcement that it will sell assets related to its Water Treatment Unit and its 54.2% stake at Cetrel S.A. for approximately BRL652 million as neutral to the company's credit ratings. Braskem's ratings already incorporate the company's aim to seek proactive measures to reduce its leverage.

The asset sale is strategically positive as it reinforces the company's commitment to a deleverage process and to its strategy of focusing on its petrochemical core business. Nevertheless, Braskem still faces challenges to recover its operating cash flow generation and to effectively sustain a deleverage process in order to avoid the current negative pressure on its ratings.

The transaction enhances Braskem's cash position, but it is not sufficient to materially change the company's currently high financial leverage. On a pro forma basis and considering Fitch's criteria, Braskem net leverage ratio, measured by net debt/EBITDA, would reduce to 4.4 times (x) from the 4.5x reported during the latest 12 months (LTM) ended Sept. 30, 2012.

Fitch currently rates Braskem as follows:

Braskem S.A.

--Long-term foreign currency Issuer Default Rating (IDR) 'BBB-';

--Long-term local currency IDR 'BBB-';

--Long-term national rating 'AA+(bra)';

--Unsecured senior notes due 2014 and 2017 'BBB-'.

Braskem International

--Long-term foreign currency IDR 'BBB-';

--Unsecured senior notes due in 2015 'BBB-'.

Braskem Finance Limited

--Long-term foreign currency IDR 'BBB-';

--Unsecured senior notes due 2018, 2020 and 2021 'BBB-';

--Unsecured senior perpetual bonds 'BBB-'.

Braskem America Finance Company

--Long-term local and foreign currency IDR 'BBB-';

--Unsecured senior notes due 2041 'BBB-'.

The corporate Rating Outlook is Negative.

Additional information is available at 'www.fitchratings.com'.

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Contacts

Fitch Ratings
Primary Analyst
Debora Jalles
Director
+55-21-4503-2629
Fitch Ratings Brasil Ltda.
Praca XV de Novembro, 20 - Sala 401 B
Centro - Rio de Janeiro - RJ - CEP: 20010-010
or
Secondary Analyst
Renata Pinho
Director
+55-11-4504-2207
or
Media Relations
Elizabeth Fogerty
+1-212-908-0526
elizabeth.fogerty@fitchratings.com

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Contacts

Fitch Ratings
Primary Analyst
Debora Jalles
Director
+55-21-4503-2629
Fitch Ratings Brasil Ltda.
Praca XV de Novembro, 20 - Sala 401 B
Centro - Rio de Janeiro - RJ - CEP: 20010-010
or
Secondary Analyst
Renata Pinho
Director
+55-11-4504-2207
or
Media Relations
Elizabeth Fogerty
+1-212-908-0526
elizabeth.fogerty@fitchratings.com