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Bond Market News
Braskem Idesa Downgraded to B+ by S&P
June 25, 2025
Braskem Idesa has been downgraded by S&P to B+ from BB-. The downgrade comes on the back of weakening of leverage and interest coverage metrics compared to initial projections by the rating agency. The company’s adjusted debt to EBITDA was around 9.3x in March 2025, vs. previous expectations of 5.0x. S&P noted that a substantial portion of EBITDA will be absorbed by interest payments in the near term.
Separately, Braskem Idesa refinanced its $116mn (MXN 2.2bn) short-term debt maturities through a new $95mn facility maturing in 2029. This new facility removed all financial covenants on leverage and interest coverage metrics, as well as released about $105mn (MXN 2bn) in restricted cash while improving the company’s average maturity to about six years. Moreover, S&P believes that the company’s operating performance will remain closely tied to ethane prices. Braskem had earlier invested $580mn in Terminal Quimica Puerto Mexico (TQPM) plant to reduce its reliance on Pemex, which contributes 60% of its ethane feedstock.
Braskem Idesa’s 7.45% 2029s are down by 0.3 points to 71.12, yielding 17.06%.
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