Mexico Lender Su Casita, After Rating Cuts, May Restructure By Year End
Mexico’s Hipotecaria Su Casita SA, the mortgage lender that had its credit rating cut three times this year by Standard & Poor’s, may reach a restructuring deal with creditors by the end of the year or the beginning of 2011, the head of the country’s mortgage agency said.
The company is currently negotiating with creditors after a deal to sell part of its assets to BBVA Bancomer SA fell through, said Javier Gavito, chief executive officer of Mexico City-based Sociedad Hipotecaria Federal, the agency in charge of developing Mexico’s mortgage market.
“They’re about to restructure the company with their creditors,” Gavito said in an interview at an event in Mexico City. “They have to reach a deal soon.”
Moody’s Investors Service on Sept. 13 downgraded the mortgage-loan provider’s unsecured debt rating for the second time this year to Caa2 from B2, and put the lender on review for a possible further downgrade, saying the company only had enough funds to cover existing debt through the middle of the first quarter of next year.
S&P in July cut Su Casita’s long-term counterparty credit rating to “CCC” from “B-” on a global scale and maintained a negative outlook on the lender, saying its financial position would “weaken further.”
Su Casita said Sept. 10 that it was evaluating “other alternatives” after the deal with Bancomer didn’t go through.
Chief Executive Officer Jose Manuel Agudo said May 6 in an interview that the lender was open to a merger, acquisition or joint venture.
To contact the reporters on this story: Jens Erik Gould at jgould9@bloomberg.net; Andres R. Martinez in Mexico City at amartinez28@bloomberg.net
To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net
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