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Bond Market News
CSN Downgraded to B+ by S&P
January 20, 2026
Companhia Siderúrgica Nacional (CSN) was downgraded by a notch to B+ from BB- by S&P. The downgrade reflects persistently high leverage and execution risks in the divestment-led deleveraging plan announced by the company last week. CSN plans to raise BRL16-18bn (~$3.0-3.3bn) through the sale of a stake in Newco CSN Infraestrutura and its cement unit, CSN Cimentos, with the aim of cutting debt by about one-third by 2027 and reducing interest costs. However, S&P highlighted significant uncertainty around the timing, regulatory approvals, and cash-flow impact of these transactions, noting that divesting the cement business would also reduce EBITDA. Absent asset sales, S&P forecasts adjusted leverage at around 5.2x in 2026, weighed down by high capital expenditure, mainly for the P15 mining project and a heavy interest burden. Although operating performance across steel, mining, and other divisions is expected to improve and lift EBITDA in 2026, free operating cash flow is likely to remain constrained in the near term. Overall, the rating agency stressed that the successful and timely execution of asset sales is critical for any meaningful and sustained improvement in CSN’s credit metrics and rating profile.
Its dollar bonds traded stable with its 5.875% 2032s at 83.5, yielding 9.4%.
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