Odebrecht's Financial Picture Gets More Complicated

Moody's has downgraded the Brazilian construction company and does not foresee its financial profile significantly recovering over the next 12 months.

Friday, October 21, 2016

The construction company is currently running three major projects in Panama: the urban renovation of Colon, with a value of $537 million, the construction of Metro Line 2, for $1.8 billion, and the expansion of Tocumen International Airport. 

See: "Former President of Odebrecht Convicted"

A statement from the rating agency notes that "...The downgrade reflects Moody's perception of increased credit risk for OEC, due to the company's deteriorated liquidity profile up to June 2016 and business uncertainties amid evolving reputational risks. The Caa1 rating considers a low likelihood that OEC's internal cash generation and financial profile will significantly recover over the next 12 months as per the challenging environment for infrastructure investments in Latin America and for the company, in particular, along with potential contingent liabilities." 

See statement by Moody's.

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From a statement issued by Standard & Poor's:

SAO PAULO (Standard & Poor's) March 29, 2016--Standard & Poor's Ratings Services lowered its global scale corporate credit rating on Odebrecht Engenharia e Construção S.A.

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