Fitch Ratings maintained the 'BBB' foreign currency Issuer Default Rating (IDR) of LAN Airlines on Rating Watch Negative. Fitch has also affirmed LAN's national equity rating at Level 2 (Primera Clase Nivel 2).
Fitch's decision to maintain the Rating Watch Negative reflects the view that the LAN/TAM SA (TAM) transaction, if approved, would weaken the credit quality of LAN. The approval of this merger has been delayed by anti-trust authorities.
Fitch maintained the rating watch positive on TAM ratings as follows:
- Foreign currency Issuer Default Rating (IDR) 'B+';
- Local currency IDR at 'B+';
- Long-term national scale rating at 'BBB+(bra)';
- USD300 million senior unsecured note due to 2020 at 'B+/RR4';
- USD300 million senior unsecured note due 2017 at 'B+/RR4';
- BRL500 million debentures issuance due 2012 at 'BBB+(bra)';
- The rating outlook is stable.
AMR Corp received a negative outlook rating from Standard & Poor’s, revised down from stable. The ratings agency reaffirmed its overall corporate credit rating of B-minus.
Shares in LAN and TAM rose 1.4% and 0.3% yesterday, while American Airlines closed 2.2% lower.
Selected American airlines' daily share price movements (% change): 18-May-2011