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        T R O U B L E D   C O M P A N Y   R E P O R T E R

                     L A T I N   A M E R I C A

               Wednesday, September 13, 2017, Vol. 18, No. 182


                            Headlines



A R G E N T I N A

CORDOBA: Fitch Affirms 'B' Long-Term IDR; Outlook Stable
JOHN DEERE: Moody's Assigns B2 Rating to Class XII and XIII Debts
SAN JUAN ARGENTINA: Fitch Assigns B Long-Term IDR; Outlook Stable


B R A Z I L

ELDORADO BRASIL: Fitch Revises Rating Watch on 'B' IDR to Evolving
MILLICOM INTERNATIONAL: Fitch to Rate USD500MM Notes BB+


E L  S A L V A D O R

MILLICOM INT'L: Moody's Rates Proposed USD500MM Senior Notes Ba2


                            - - - - -


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A R G E N T I N A
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CORDOBA: Fitch Affirms 'B' Long-Term IDR; Outlook Stable
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Fitch Ratings has affirmed the Municipality of Cordoba's Long-Term
Foreign- and Local-Currency Issuer-Default Ratings (IDRs) at 'B'.
The Rating Outlook is Stable. Fitch has also affirmed at 'B' the
Long-Term Foreign-Currency Rating of the municipality's senior
unsecured bond issuance.

KEY RATING DRIVERS

Cordoba's ratings reflect the city's low level of debt; its
important economic position in the regional and national context;
and its strong share of locally collected revenues. The ratings
are limited by the municipality's structural deficits and volatile
operating margins, by the high level of unhedged currency exposure
as 77.5% of debt was denominated in foreign currency, and the high
level of payables relative to its liquidity position. The ratings
are capped by Argentina's sovereign rating.

The municipality of Cordoba is the capital of the Province of
Cordoba and is the second most populated city after Buenos Aires.
The city is one of the most important social, educational and
economic centres in Argentina. The municipality has a diverse
economic profile that translates into a strong collection of local
taxes on commerce and industry that in 2016 represented 60.6% of
its total revenues.

The city has a high expenditure burden regarding the provision of
urban, educational and health services. Partly, due to Argentina's
macroeconomic context of high inflation, currency depreciation,
and high infrastructure needs. In 2016, staff expenses represented
65.3% of operating revenues, in line with the argentine peer's
average of 65%, a structurally high level when compared to
international peers.

Cordoba's operating margins were volatile during 2012 - 2016. In
2015, the entity's margin diminished due to an electoral year and
higher capex related staff expenditure. However, in 2016 budgetary
performance improved due to a recent fiscal equality agreement
between the province and municipality that partially offset
expenditure pressures, as well as the greater share of co-
participation funds being transferred to the municipality. In the
first semester of 2017 this positive trend remains, as operating
revenues grew at a faster pace than operating expenses. The city's
budgetary performance will again be positive in 2017.

In 2016 Cordoba's direct debt was ARS3.3 billion, representing
27.8% of its operating revenues, a low level. The entity's direct
debt is mainly composed of bond issuances and treasury bills. In
September 29 of 2016, the city issued the 7.875% senior unsecured
notes for USD150.0 million with semi-annual interest payments, a
maturity of eight years, and capital balloon payments in 2022,
2023, and 2024. Of the proceeds, around USD51 million was used to
refinance 2017 debt maturities and the remaining funds will be
allocated for capex funding.

Although currency exposure increased with this issuance, as 77.5%
of debt is now denominated in foreign currency, the city's proven
refinancing capacity improved the maturity profile towards a
longer term. Considering 2017 budgeted an authorized debt,
leverage ratios would still be in line with Cordoba's credit
profile. Considering liquidity, Cordoba's level of floating debt
(payables) is deemed high relative to the entity's liquid cash
position. In 2016 payables amounted to ARS2.3 billion and
represented around 69 days of primary expenditure.

Finally, the municipality's management policies have been centred
in strengthening local revenue collection, administrative
modernization, and an important infrastructure development plan
(2016 - 2019) of ARS5.2 billion that intends to tackle the
infrastructure deficit. Capex plans include housing, street
lighting, roads, sewage, education, and other urban projects.

RATING SENSITIVITIES

An upgrade of Argentina's sovereign rating accompanied by higher
and sustained operating margins could lead to an upgrade in
Cordoba's ratings.


JOHN DEERE: Moody's Assigns B2 Rating to Class XII and XIII Debts
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Moody's Latin America Agente de Calificacion de Riesgo (MLA) has
assigned a B2 global scale and an A1.ar national scale foreign
currency debt rating to John Deere Credit Compania Financiera
S.A.(JDC)'s Class twelve and thirteenth senior debt issuances. The
issuances, each one for up to $50 million, will be due in 36 and
48 months respectively. The total combined amount of both
issuances can not exceed $50 million.

The outlook on the ratings is stable.

The following ratings were assigned to JDC's Class XII and XIII
senior unsecured debt issuance:

B2 Global Foreign Currency Debt Rating

A1.ar Argentina National Scale Foreign Currency Debt Rating

RATINGS RATIONALE

JDC's global scale rating (GSR) is constrained by Argentina's
operating environment, which remains challenging despite various
market-friendly policy reforms implemented by the new
administration that are expected to result in a return to economic
growth and a continued decline in inflation this year. The
environmental challenges outweigh JDC's sound financial
fundamentals. The ratings benefit from Moody's assessment of a
very high probability that JDC will receive support from its
foreign-owned parent, John Deere Credit Inc, rated (P)A2 with
negative outlook, in an event of stress. However, the company's
long-term global senior unsecured foreign currency debt rating is
constrained by Argentina's foreign currency bond ceiling.
Reflecting this constraint, the A1.ar national scale rating
assigned to the notes is the highest of the three national scale
rating categories corresponding to a global scale rating of B2.

The ratings also consider JDC's adequate capital cushion, which
provides loss absorption capacity in an event of stress, and its
high reliance on market funds, as the case for other captive
finance companies, which expose it to swings in interest rates and
refinancing risk. Market funds to tangible assets jumped
considerably to almost 84% in June 2017, from 71% in late 2016.
However, this risk is partially mitigated by credit facilities
available from the company's parent in an event of stress, as well
as long term financing provided by John Deere & Co's local
subsidiary, Industrias John Deere Argentina.

In addition, JDC's rating is also supported by its good asset risk
profile - its nonperforming loan ratio was 0.3% as of June 2017 -,
and the fact that its lending book is highly collateralized.
Nevertheless, given the company's narrow focus on providing
financing to the agricultural sector, its asset quality is
susceptible to climate risk. Although the company posts ample
nominal profitability, as evidenced by its 3.3% net interest
margin and 1.6% net income to tangible assets as of June 2017, its
results are distorted by the high, yet declining rate of
inflation.

WHAT COULD CHANGE THE RATING UP/DOWN

An upgrade of the Argentine sovereign and a corresponding increase
in Argentina's debt and deposit ceilings would put upward pressure
on the company's ratings, provided the entity continues to
demonstrate sound operating performance. Conversely, a downgrade
of the Argentine sovereign could put downward pressure on the
entity's ratings, but this is unlikely at this time given
Argentina's positive outlook.


SAN JUAN ARGENTINA: Fitch Assigns B Long-Term IDR; Outlook Stable
-----------------------------------------------------------------
Fitch Ratings has assigned the Province of San Juan, Argentina
Long-term Foreign and Local Currency Issuer Default Ratings (IDRs)
of 'B' with a Stable Outlook.

KEY RATING DRIVERS

San Juan's ratings reflect its strong fiscal performance and
liquidity and its low level of debt. However, the province's
ratings are capped by Argentina's sovereign ratings and are
limited by San Juan's weak local economy, moderate share of
locally collected revenues, and high transport infrastructure
needs.

San Juan's administrative policies have been focalized towards
fiscal solvency and budgetary surplus. During 2012-2016, the
province's operating margins averaged 23.6% in a macroeconomic
context of high inflation and currency devaluation. In 2015 and
2016 margins were lower (22.2% and 16.7% respectively) due to an
electoral year, economic downturn, and higher inflation.

In 2016 locally collected revenues were around 41.8% of San Juan's
total operating revenues (excluding federal tax co-participation),
a moderate level. However, this is balanced by lower staff
expenditure than other Argentine provinces. In 2016 San Juan's
staff expenditure represented 55.1% of its operating expenditure,
compared to the Argentine peer average of 65%. According to
information from June 2017 San Juan will maintain a positive
financial performance during 2017, similar to 2016 and close to
the budgeted margin of 14.9%.

Because of its solid financial balances, San Juan has a strong
liquidity position. Financial surpluses averaged 14.9% during
2012-2016 and were allocated for capex and capitalization of cash
deposits. In 2016 the province had cash deposits of ARS4.3
billion, including an anticyclical fund of ARS2.2 billion.

San Juan's anticyclical fund was created by law 12 years ago and
must be maintained at an equivalent of two monthly salary grids.
To date, the balance of this fund is above the required. If there
is a seasonal shortfall of revenues for more than six consecutive
months, the fund could be used primarily for the payment of
salaries. Due to its high liquidity, San Juan does not have short
term debt. Also, payables are equivalent to eight days of primary
expenditure, a very low level.

In 2016 San Juan's debt totalled ARS4.6 billion in 2016. Debt
levels are low, but currency exposure is high as 45.7% of debt is
denominated in foreign currency, unhedged. According to the 2017
budget, San Juan can seek financing sources for up to 20% of total
expenses (ARS6.8 billion). The province intends to maintain a high
level of capex and will seek financing sources to complement
available funds. Considering prospective debt, Fitch estimates
that leverage and sustainability ratios will remain low to
moderate and adequate for the entity's financial profile. However,
currency exposure could increase with an issuance in USD.

San Juan has two main unconsolidated public companies, a
provincial energy company (Energia Provincial Sociedad del Estado-
Epse) and a public water and sewage company (Obras Sanitarias
Sociedad del Estado- Osse). Also, the province has an ownership of
16.78% of Banco San Juan (BSJ). BSJ was privatized in 1996 and has
adequate financial ratios. To date these companies do not
represent any contingent risks for the province. San Juan is among
the provinces that transferred its pension funding to the national
government, thus eliminating operative risks regarding pension
deficit funding.

San Juan is located in the northwest region of Argentina (Cuyo
Region). Similar to other Argentine peers, San Juan has a weak
local economy operating in a macroeconomic context of high
infrastructure needs and scarce capital sources. Historically the
province's economy has been undiversified; in 2016 main exports
were from the mining (76%) and viticulture sectors (11%), mainly
gold. San Juan's exports represent around 1.36% of national
exports.

Economic development is challenged, among other things, by high
transportation costs due to the fact that the province has only
road infrastructure for the transportation of its inputs and final
products from and to consumption centres. The province intends to
boost economic diversification by offering tax exemptions in
productive sectors and by capex in the agro industrial, tourism,
renewable energy, and services sectors.

RATING SENSITIVITIES

An upgrade of Argentina's sovereign rating would have a positive
impact on the San Juan's ratings. On the other hand, sustained
operating expenditure growth that significantly decreases
operating margins and liquidity could result in a negative rating
action.


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ELDORADO BRASIL: Fitch Revises Rating Watch on 'B' IDR to Evolving
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Fitch Ratings has revised the Rating Watch on Eldorado Brasil
Celulose S.A.'s (Eldorado) 'B' Long-Term Foreign and Local
Currency Issuer Default Ratings (IDR) and 'BBB-(bra)' Long-Term
National Rating to Evolving from Negative. Fitch has also revised
the Rating Watch for the 2021 notes (rated 'B/RR4') issued by
Eldorado Intl. Finance GmbH and guaranteed by Eldorado and
Cellulose Eldorado Austria GmbH to Evolving from Negative.

KEY RATING DRIVERS

The Rating Watch reflects the uncertainty of Eldorado's credit
profile following the announcement that J&F Investimentos S.A.
(J&F) has entered into a share purchase agreement to sell up until
the totality of its direct and indirect equity interest held in
Eldorado to CA Investment (Brazil) S.A., a Paper Excellence
company. The transaction amounted BRL15 billion and includes
Eldorado's net debt of about BRL7.8 billion. Paper Excellence has
seven industrial operations in Canada and in France, with an
annual production capacity of approximately 2.3 million tons of
pulp.

Fitch will resolve the Watch once it has a clearer understanding
of Eldorado's credit profile following the acquisition.
Positively, since being placed on Rating Watch Negative in May
2017, the company released its year-end financial statements and
pulp prices have been relatively robust, which has helped
Eldorado's cash flow to remain neutral. In addition, Eldorado's
acquisition by new shareholders could facilitate the refinancing
of BRL2.4 billion of short-term debt as of Dec. 31, 2016. This
would relieve the company's heavy short-term debt burden. As of
March 31, 2017, the company had BRL926 million of cash and
marketable securities.

Negatively, the financial strength of Paper Excellence and its
ability to support and improve the financial profile of Eldorado
remains uncertain. Without this support, the company could
struggle to meet upcoming debt obligations, as the exposure of
lenders is not expected to increase due to legal risks faced by
Eldorado's controlling shareholders.
The ability and willingness of Paper Excellence to facilitate the
refinancing of Eldorado's short-term debt will be a key input to
future rating actions. Other considerations will include more
visibility on the potential synergies, financial and operational
ties with Paper Excellence.

DERIVATION SUMMARY

Eldorado enjoys an excellent position in the production cost curve
because of very productive forests, a favorable climate for
growing trees, and modern pulp mill. This puts the company's
business risk profile in line with Latin America pulp companies
like Fibria ('BBB-'/Outlook Stable), Suzano ('BB+'/Outlook
Positive), Empresas CMPC ('BBB'/Outlook Stable), and Celulosa
Arauco ('BBB'/Outlook Negative).

Like other Latin American pulp producers, Eldorado is exposed to
the volatility of pulp prices that follow the supply and demand
imbalance. Eldorado's leverage and refinancing risk is high
compared to other Latin America pulp companies (such as Fibria,
Suzano, Empresas CMPC and Celulosa Arauco), which has resulted in
a lower rating. Eldorado's rating has also been constrained by
concerns related to the corporate governance practices of its
controlling shareholders.

KEY ASSUMPTIONS

Fitch's key assumptions within the agency's rating case for the
issuer include:
-- Net pulp prices between USD550 per ton and USD575 per ton in
    2017 and 2018;
-- Pulp sales volume of 1.7 million tons in 2017;
-- FX rate at 3.2 BRL/USD in 2017 and 3.3 BRL/USD in 2018;
-- Base case does not incorporate investments in the new pulp
    mill.

Key Recovery Rating Assumptions
-- The recovery analysis assumes that Eldorado would be
    considered a going-concern in bankruptcy and that the company
    would be reorganized rather than liquidated.
-- Fitch has assumed a 8% administrative claim.

Going-Concern Approach:
-- Eldorado's going-concern EBITDA is based on December 2016
    EBITDA.
-- The going-concern EBITDA estimate reflects Fitch's view of a
    sustainable EBITDA level upon which Fitch base the valuation
    of the company. The going-concern EBITDA is 10% higher than
    2016's EBITDA to reflect higher pulp prices.
-- An EV multiple of 5x is used to calculate a post-
    reorganization valuation and reflects a mid-cycle multiple.
    The waterfall results in a 45% recovery corresponding to 'RR4'
    recovery.

RATING SENSITIVITIES

Fitch will resolve the Rating Watch Evolving once it has a clearer
understanding of Eldorado's credit profile and refinancing risk
following the conclusion of the transaction. In addition, Fitch
will evaluate the relative credit quality and financial profile of
Paper Excellence, as well as Fitch's view on the degree of
financial support or financial strain the buyer would provide.

LIQUIDITY

As of Dec. 31, 2016, Eldorado had cash and marketable securities
of BRL1.2 billion and total debt of BRL9.1 billion, of which about
BRL2.4 billion is due in the short term. Excluding trade finance
lines, debt maturities during 2017 are about BRL941 million.
Eldorado needs to continue to refinance part of its impending debt
maturities, as FCF is still limited and pressured by high
financial expenses.

Total debt was composed of loans from the Brazilian Development
Bank, pre-export financing, export credit agencies, export credit
notes, debentures from Fundo de Investimento do Fundo de Garantia
do Tempo de Servico, a term loan, and senior unsecured notes.

FULL LIST OF RATING ACTIONS

Fitch has revised the Watch on the following ratings to Evolving
from Negative:

Eldorado Brasil Celulose S.A.
-- Long-Term Foreign Currency IDR 'B';
-- Long-Term Local Currency IDR B';
-- Long-Term National Scale Rating 'BBB-(bra)'.

Eldorado Intl. Finance GmbH
-- Senior unsecured notes, in the amount of USD350 million and
    due in 2021 'B/RR4'.

The transaction was issued by Eldorado Intl. Finance GmbH and
guaranteed by Eldorado Brasil Celulose S.A. and Cellulose Eldorado
Austria GmbH.



MILLICOM INTERNATIONAL: Fitch to Rate USD500MM Notes BB+
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Fitch Ratings expects to rate Millicom International Cellular,
S.A. (MIC)'s proposed up to USD500 million senior unsecured notes
due 2028 'BB+(EXP)'. Proceeds from the issuance are expected to be
used to refinance its 2021 senior notes and for general corporate
purposes, including capex.

Millicom International Cellular S.A.'s (MIC) ratings reflect the
company's geographical diversification, strong brand recognition
and network quality, all of which have contributed to its leading
market positions in key markets, strong subscriber base, and solid
operating cash flow generation. In addition, the rapid uptake in
subscriber data usage and MIC's ongoing expansion into the under-
penetrated fixed-line services bode well for its medium- to long-
term revenue growth.

Despite these diversification benefits, MIC's ratings are tempered
by the company's presence in countries in Latin America and Africa
with low sovereign ratings and low GDP per capita. The operational
environment in these regions in terms of political and regulatory
stability and economic conditions tends to be more volatile than
in developed markets.

KEY RATING DRIVERS

Strong Market Positions
Fitch expects MIC's strong market position to remain intact,
supported by its network quality and extensive coverage, strong
brand recognition and growing fixed-line operations. These
qualities, exhibited across its well-diversified operational
geographies, should enable the company to continue to support its
stable cash flow generation and growth opportunities in its
underpenetrated data and cable segments.

Stable Performance
The company maintained a relatively stable EBITDA of USD2.2
billion as of the LTM ended June 30, 2017, in line with 2016,
despite lower revenue due to improved profitability during the
period. MIC's margin improved to 35.1% from 34.5% as it continued
to benefit from operational synergies following its merger with
UNE EPM Telecomunicaciones S.A., as well as lower corporate costs.
Fitch expects MIC's EBITDA generation to undergo low single-digit
growth over the medium term driven by increasing penetration of
mobile data and fixed-line services.

Solid Financial Profile
Fitch forecasts MIC's leverage will remain solid over the medium
term, in the absence of aggressive shareholder pay-outs, backed by
stable cash flow generation. MIC's adjusted consolidated net
leverage increased slightly to 2.6x as of the LTM ended June 30,
2017 from 2.5x at year-end 2016. Its net leverage, based on the
proportionate consolidation also increased marginally to 2.2x from
2.1x in 2016. Based on Fitch's forecast for resumed modest EBITDA
expansion over the medium term, the company's adjusted
consolidated net leverage is forecast to fall below 2.5x, with its
proportionate net leverage remaining close to 2.0x.

Diversifying Revenue Mix
MIC's growth strategy will be increasingly centered on mobile data
and fixed-line services as it tries to alleviate pressure on its
declining voice and SMS revenues. The company's Business to
Customer mobile data and Home segments represented 39% of total
revenues during the LTM ended June 30, 2017 up from 36% and 30%
during 2016 and 2015, respectively. Fitch expects this trend to
continue over the medium term, supported by increasing mobile
penetration and the accelerated expansion of MIC's cable
footprint. Mobile data penetration reached 38% as of June 30, 2017
from 36% at end-2016 and 29.5% at end-2015, supported by increased
smart phone sales and 4G subscribers.

Structural Subordination
Creditors of the holding company are subject to structural
subordination to the creditors of the operating subsidiaries given
that all cash flows are generated by subsidiaries. As of June 30,
2017 the group's consolidated gross debt was estimated to be
approximately USD5.3 billion, including the committed redemption
of its 2020 notes, resulting in 73% of the group's total debt
allocated to the operating subsidiaries. Positively, Fitch
believes that a stable and high level of cash upstreams, through
dividends and management fees from its subsidiaries, is likely to
remain intact over the long term and will mitigate any risk
stemming from this structural weakness.

Concentration in Low-Rated Sovereigns
MIC's ratings are tempered by its operational footprint in
countries in Latin America and Africa with low sovereign ratings,
despite the diversification benefit. The operational environment
in these regions, in terms of political and regulatory stability
and economic conditions, tends to be more volatile than in
developed markets. The company generated approximately 89% of its
revenue in Latin America and 11% in Africa during the first half
of 2017. During 2016, 75% of MIC's consolidated EBITDA was
generated through its four key cash generating operating
subsidiaries located in Guatemala (29%) whose sovereign rating is
'BB', Colombia (21%) rated 'BBB', Paraguay (13%) rated 'BB' and
Honduras (12%) 'NR'.

DERIVATION SUMMARY

MIC's rating is well-positioned relative to its regional telecom
peers in the 'BB' rating category based on its solid financial
profile, operational scale, geographic and service
diversification, and strong market shares in its key markets. Weak
operating environment tempers MIC's credit to a degree given its
operational concentration in countries with low sovereign ratings
in Latin America and Africa. Parent/subsidiary linkage is a key
rating consideration given the strong financial linkage between
MIC and its operating subsidiaries. No country ceiling was in
effect for the ratings.

KEY ASSUMPTIONS

Fitch's key assumptions within its rating case for the issuer
include:

-- Low single digit annual revenue growth in the medium term;
-- Mobile service revenue contraction to remain uncurbed over the
    medium term despite increasing mobile data revenues;
-- Revenue contribution from mobile data and fixed-line
    operations to grow towards 55% of total revenues by 2017;
-- Fixed-line segment to undergo double-digits revenue growth in
    the short to medium term;
-- Annual capex, including spectrum, of USD1.2-1.3 over the
    medium term;
-- No significant increase in shareholder distributions in the
    short to medium term with annual dividend payments remaining
    at USD265 million.

RATING SENSITIVITIES

Future Developments That May, Individually or Collectively, Lead
to Positive Rating Action
-- Improvement in the adjusted net leverage to 2.0x on a
    sustained basis;
-- Clarity on the pending investigation on the improper payment
    related with Comcel Trust, with no material credit impact.

Future Developments That May, Individually or Collectively, Lead
to Negative Rating Action
-- Net leverage increasing toward 3.0x;
-- Sustained negative FCF generation due to
    competitive/regulatory pressures;
-- Sizable M&A activities and aggressive shareholder
    distributions;
-- Material negative impact from the pending investigation with
    regards to Comcel Trust.

LIQUIDITY

MIC's liquidity profile is solid given its large cash position,
which fully covered the short-term debt. As of June 30, 2017 the
consolidated group's readily available cash was USD1,038 million,
which compares to its short-term debt of USD537 million. MIC's
debt maturities are well spread with an average life of six years.
MIC also has a five-year undrawn revolving credit facility for
USD600 million until 2022, which further bolsters its liquidity
position.

Fitch does not foresee any liquidity problem for both the
operating companies and the holding company given the operating
companies' stable cash generation and their consistent cash
upstream to the holding company. MIC also has a good record in
terms of its access to capital markets when in need of external
financing, which supports its liquidity management.

FULL LIST OF RATING ACTIONS

Fitch currently rates MIC:

Millicom International Cellular, S.A.
-- Long-term foreign currency IDR 'BB+'; Outlook Stable;
-- Long-term local currency IDR 'BB+'; Outlook Stable;
-- Senior unsecured debt 'BB+'.


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MILLICOM INT'L: Moody's Rates Proposed USD500MM Senior Notes Ba2
----------------------------------------------------------------
Moody's Investors Service assigned a Ba2 rating to the proposed
USD500 million senior unsecured notes due 2028 to be issued by
Millicom International Cellular S.A.. Millicom's existing ratings
and its Ba1 CFR remain unchanged. The ratings outlook is negative.

The issuance is part of Millicom's liability management with the
objective of extending the company's debt maturity profile while
reducing its cost of debt. The new issuance will not affect the
company's leverage metrics since it will replace existing 2021
notes through a tender offer.

The rating of the proposed notes assumes that the issuance will be
successfully completed as planned and will replace the same value
in existing debt, and that the final transaction documents will
not be materially different from draft legal documentation
reviewed by Moody's to date and assume that these agreements are
legally valid, binding and enforceable.

Rating assigned:

Issuer: Millicom International Cellular S.A.

USD500 million Senior unsecured notes due 2028: Ba2

The company's existing ratings are unchanged:

Issuer: Millicom International Cellular S.A.

Corporate Family Rating: Ba1

Probability of Default Rating: Ba1-PD

Senior Unsecured Regular Bond/Debenture: Ba2

The outlook for all ratings is Negative

RATINGS RATIONALE

Millicom's Ba1 Corporate Family rating reflects its stable
operating performance, solid business model, strong market shares
in key geographies, and a multiregional balance of profits and
cash flow generation. The rating also incorporates regulatory and
other operating risks and limitations in the countries where it
operates, the transition to a lower-margin product mix and
historically negative free cash flow generation. In October 2015,
Millicom self-reported potential improper payments on behalf of
its Guatemalan subsidiary. At this point, there is still little
information regarding the timing of the legal outcome or estimates
of potential monetary penalties.

The Ba2 ratings on Millicom's senior unsecured notes reflect
structural subordination to debt at the operating level as well as
their unguaranteed status. Representing most of the debt at the
holding company level, the unsecured notes are equivalent to about
32% of consolidated debt as of June 30, 2017 or 27% pro forma for
the call of the 2020 notes finalized in the beginning of August
2017.

The proceeds raised with the proposed notes will be used in the
repurchase of Millicom's USD658 million notes due 2021 (Ba2
negative) in a tender offer that will be launched in conjunction
with the new notes resulting in no temporary increase in leverage.
The negative outlook reflects the very little information
available regarding the timing and estimates of legal outcomes or
possible monetary fines regarding the potential improper payments
at Millicom's Guatemalan subsidiary. The lack of information
limits perspectives and the impact of future public disclosures
and severity of the allegations are still unpredictable at this
point in time. In addition to monetary penalties, Moody's also see
increased reputational risk, which could impact investors
sentiment and limit their access to funding. If the resolution of
the investigation considers that allegations are true and severe,
there could be a spillover effect on Millicom's well-regarded Tigo
brand, which is used by the group across the LATAM region.
Additionally, Moody's could expects regulatory scrutiny to
increase towards both companies. If matters are clarified and
resolved with limited or manageable implications to the companies'
domestic and international businesses and to their liquidity
profile, the ratings could be stabilized.

Positive pressure on Millicom's ratings could arise when there is
more clarity surrounding the ongoing investigation. An upgrade
could then occur if the company's gross debt leverage adjusted by
Moody's is reduced to below 2.5 times on an ongoing basis (3.0
times in the LTM ended June 2017), its retained cash flow improves
to above 30% adjusted RCF/gross debt (18.3% in the LTM ended June
2017), and if the group sustains a strong liquidity position. An
upgrade would also be dependent on an improvement in the balance
of risk across the countries in which Millicom operates and would
require the group to maintain its strong market positions, a good
level of geographical diversification of cash flows, the continued
ability to repatriate dividends from its subsidiaries and
conservative financial policies.

Downward pressure on Millicom's ratings could develop if liquidity
or metrics deteriorate as result of the ongoing investigation
regarding improper payments or as a result of an elevated gross
debt leverage adjusted by Moody's surpassing 3.0 times, higher
than anticipated shareholder remuneration, or a material debt-
funded acquisition. The ratings could also be downgraded if
Millicom increases its exposure to riskier countries, or in case
of increased sovereign risk in any of the countries in which it
currently operates.

The principal methodology used in this rating was
Telecommunications Service Providers published in January 2017.

Millicom is a global telecommunications investor focused on
emerging markets with cellular operations and licenses in 11
countries in Latin America and Africa. The company has over 57
million subscribers and derives around 89% of revenues from its
Central and South America operations in El Salvador, Guatemala,
Honduras, Colombia, Bolivia and Paraguay. In Africa, Millicom
operates in Chad, Tanzania, Rwanda, and Ghana. The company also
offers cable and satellite TV services in Central and South
America. During the last twelve months ended June 30, 2017,
revenues reached USD4.4 billion. Millicom is incorporated in
Luxembourg and publicly listed on the Stockholm Stock Exchange.


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Monday's edition of the TCR-LA delivers a list of indicative
prices for bond issues that reportedly trade well below par.
Prices are obtained by TCR-LA editors from a variety of outside
sources during the prior week we think are reliable.   Those
sources may not, however, be complete or accurate.  The Monday
Bond Pricing table is compiled on the Friday prior to publication.
Prices reported are not intended to reflect actual trades.  Prices
for actual trades are probably different.  Our objective is to
share information, not make markets in publicly traded securities.
Nothing in the TCR-LA constitutes an offer or solicitation to buy
or sell any security of any kind.  It is likely that some entity
affiliated with a TCR-LA editor holds some position in the
issuers' public debt and equity securities about which we report.

Tuesday's edition of the TCR-LA features a list of companies with
insolvent balance sheets obtained by our editors based on the
latest balance sheets publicly available a day prior to
publication.  At first glance, this list may look like the
definitive compilation of stocks that are ideal to sell short.
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

Submissions about insolvency-related conferences are encouraged.
Send announcements to conferences@bankrupt.com


                            ***********


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter-Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C.,
USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T.
Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A.
Chapman, Editors.

Copyright 2017.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Latin America subscription rate is US$775 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for members
of the same firm for the term of the initial subscription or
balance thereof are US$25 each.  For subscription information,
contact Peter A. Chapman at 215-945-7000 or Joseph Cardillo at
856-381-8268.


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