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250930.mbx 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 Tuesday, September 30, 2025, Vol. 26, No. 195 Headlines A R G E N T I N A ARGENTINA: Bessent Halts Crisis as US Lifeline Upends Short Bets ARGENTINA: Milei's Tax Cut on Crops Quickly Lures US$7BB ARGENTINA: Poverty Falls to Lowest Level Since 2018 CORDOBA: Fitch Affirms 'CC' IDRs [] ARGENTINA: 'Is Moving In The Right Direction,' IMF Says B R A Z I L BRAZIL: Banks Outweigh Mining Giants in Market's Balancing Act FS INDUSTRIA: Fitch Affirms 'BB-' LongTerm Currency IDRs OCEANICA ENGENHARIA: Sec. Notes Add-on No Impact on Moody's B3 CFR VAMOS LOCACAO: Fitch Assigns 'BB-' LongTerm IDR, Outlook Stable J A M A I C A JAMAICA: BOJ Reports Net Profits of $19.6BB thru Sept. 10 M E X I C O BOWERS TRUCKING: Case Summary & 20 Largest Unsecured Creditors P U E R T O R I C O PUERTO RICO: Trump Administration Faces Lawsuit Over Board Firings - - - - - ================= A R G E N T I N A ================= ARGENTINA: Bessent Halts Crisis as US Lifeline Upends Short Bets ---------------------------------------------------------------- Vinicius Andrade & Nicolle Yapur at Bloomberg News report that speculators seeking to profit from the sell-offs racing through Argentina's markets were stopped dead in their tracks by a powerful investor willing to take the opposite side of the trade: the US government. The strong show of support for President Javier Milei from US Treasury Secretary Scott Bessent – first by pledging to use "all options," and then by announcing a plan to potentially provide a US$20-billion lifeline and buy Argentina's bonds – quickly halted a rout that was burning through the government's reserves as it fended off a run on its currency, according to Bloomberg News. Whether the money materialises or not, investors said the prospect alone will likely be enough to put a floor under Argentina's stocks, bonds and currencies ahead of key national elections late next month, Bloomberg News relays. That's because few, if any, are willing to stand behind a bearish bet that could get blown up by another US signal of support, Bloomberg News relates. "That's an outsized package and coming from Scott Bessent – who understands markets – it should stabilise here," said Ray Zucaro, chief investment officer at RVX Asset Management LLC in Miami, who currently has a neutral view on Argentina's bonds, Bloomberg News discloses. "It is hard to be short," he added. Bloomberg News relates that the potential intervention – which traders likened to Bill Clinton's rescue of Mexico in the mid-1990s – offers a rare break from the Trump administration's brand of economic nationalism, in this case to help a besieged ideological ally in a country whose financial crises have had little impact on the United States. Milei, a libertarian economist who ushered in free-market shock therapy aimed at ending the crises that have shadowed the country for decades, had some success in taming runaway inflation, Bloomberg News discloses. But a political scandal surrounding insiders in his administration and voter anger at some of his spending cuts handed him surprisingly large defeats in recent local elections, raising fears among investors that his reforms could stall if he suffers a setback in the national midterm vote on October 26, Bloomberg News says. The result was a sharp sell-off that hit everything from dollar bonds to the peso and equities – and left the government burning through foreign-exchange reserves to prevent its currency from breaking its peg to the US dollar, Bloomberg News relays. Markets bounced back after Bessent's announcements eased worries that the election could plunge Argentina toward another crisis, Bloomberg News discloses. "This is likely to limit losses in the event of a bad October," said Gorky Urquieta, co-head of Neuberger Berman's emerging markets debt team, Bloomberg News says. The step has also bolstered confidence that Argentina will avoid an escalating run on the currency and have enough money to cover its upcoming obligations, Bloomberg News relates. The Milei administration is scheduled to make more than US$4 billion in debt payments in January, Bloomberg News notes. "The probability of default during Milei's term decreased significantly," said Matias Montes, head of strategy at London-based EMFI Securities, Bloomberg News notes. The Trump administration's potential use of the Treasury's Exchange Stabilization Fund – a reserve created to promote orderly foreign-exchange markets – sends a strong signal that it is willing to use US power to support Milei, who Bessent characterised as "systemically important US ally," Bloomberg News discloses. Bloomberg News relays that the promise had driven the peso to a three-day rebound that left it at 1,337.50 pesos per dollar, the highest level in almost a month. Dollar bonds were up across the curve, almost erasing the losses seen after the government's defeat in the Buenos Aires vote on September 7. The country's main stock exchange staged a three-day gain that pushed it up over nine percent, Bloomberg News relays. Attention now turns to whether Milei can secure enough political support in October to press ahead with his policies, said Jeff Grills, head of US cross-asset and emerging-markets debt at Aegon Asset Management, Bloomberg News notes. He said the government will likely need to revise its currency targets under the prior deal cut with the International Monetary Fund, Bloomberg News adds. But overall, he viewed the US help as positive. "It buys them time," he said. About Argentina Argentina is a country located mostly in the southern half of South America. Its capital is Buenos Aires. Javier Milei is the current president of Argentina after winning the November 19, 2023 general election. He succeeded Alberto Angel Fernandez in the position. Argentina has the third largest economy in Latin America. The country's economy is an upper middle-income economy for fiscal year 2019, according to the World Bank. Historically, however, its economic performance has been very uneven, with high economic growth alternating with severe recessions, income maldistribution and in the recent decades, increasing poverty. In March 2022, the International Monetary Fund (IMF) approved a 30-month arrangement under an Extended Fund Facility for Argentina in the amount of SDR 31.914 billion (equivalent to US$44 billion, or 1000 percent of quota) -- with an approved immediate disbursement of an equivalent of US$9.65 billion. Argentina's IMF-supported program sought to improve public finances and start to reduce persistent high inflation through a multi-pronged strategy. On April 11, 2025, the IMF further approved a 48-month Extended Fund Facility (EFF) arrangement for Argentina totaling US$20 billion (or 479 percent of quota), with an immediate disbursement of US$12 billion, and a first review planned for June 2025 with an associated disbursement of about US$2 billion. The program is expected to help catalyze additional official multilateral and bilateral support, and a timely re-access to international capital markets. Fitch Ratings, on May 12, 2025, upgraded Argentina's Long-Term Foreign-Currency and Local-Currency Issuer Default Rating (IDR) to 'CCC+' from 'CCC'. The upgrade reflects the launch of a new IMF program, among other things. S&P Global Ratings, in February 2025 lowered its local currency sovereign credit ratings on Argentina to 'SD/SD' from 'CCC/C' and its national scale rating to 'SD' from 'raB+'. Moody's Ratings, in January 2025, raised Argentina's local currency ceiling to B3 from Caa1 and the foreign currency ceiling to Caa1 from Caa3. DBRS, Inc. upgraded Argentina's Long-Term Foreign and Local Currency Issuer Ratings to B (low) from CCC in November 2024. ARGENTINA: Milei's Tax Cut on Crops Quickly Lures US$7BB -------------------------------------------------------- Ignacio Olivera Doll at Bloomberg News reports that Argentina's currency market is being flooded with dollars from grain purchases, prompting calls for the government to start rebuilding its stock of hard-currency reserves after selling more than US$1 billion. Exporters rushed to take advantage of a temporary tax break on export duties disclosed by President Javier Milei's administration and a foreign-exchange rate that became even more favorable after forceful pledges of US support for his economic agenda, according to Bloomberg News. Bloomberg News relays that the tax agency said the US$7 billion cap set by the government had been reached. To benefit from the tax relief, 90 percent of those dollars have to be sold in the FX market within 72 hours. Boosting reserves has been a long-standing demand from analysts and the International Monetary Fund (IMF), but so far Milei has resisted, Bloomberg News notes. That will likely change now that the peso, a currency that's been ravaged by repeated crises, has stabilized, Bloomberg News says. The sudden influx represents "an enormous figure for a currency market that usually trades about US$500 million a day," said Regina Martinez Riekes, a director at Amauta Inversiones, Bloomberg News relays. "Authorities must not only accumulate reserves, they also need to prevent excessive peso appreciation," he added. Bloomberg News discloses that the peso, which hit a record low, has since rebounded nearly 10 percent. Devaluation bets dropped sharply after US President Donald Trump's administration said it's discussing a US$20-billion swap line with Argentina, Bloomberg News notes. For many, the time for Milei to act is now, Bloomberg News relays. "It's necessary for the Central Bank to use these temporary supply shocks to buy dollars and have enough reserves to deal with a potential reversal," said Daniel Marx, a former finance secretary and director at Quantum Finanzas, a consultancy, Bloomberg News notes. Central Bank reserves have fallen by US$4 billion to US$39 billion since peaking on August 4, after the monetary authority sold more than US$1 billion in just three days to defend the trading band agreed with the IMF, Bloomberg News relates. Analysts say the need to rebuild buffers is why markets expect a floor for the exchange rate, Bloomberg News discloses. Any replenishment of reserves would mark a turn for Milei, who previously avoided issuing pesos that could undermine his disinflation goals, Bloomberg News relays. "There will be no intervention until the peso hits the band floor — that is, no purchases above 1,000 per dollar," the President posted on X on April 16. At midyear, the government even chose to issue peso debt payable in dollars rather than intervene in the FX market, Bloomberg News notes. Bloomberg News says that bankers and analysts say a change is imminent. "I estimate they will start buying at 1,300 or 1,350, and then we'll be able to say the FX band has narrowed," said Carolina Schuartzman, director at Banco de Valores. "If they let too many dollars slip away and don't rebuild reserves, the outlook won't be good. Risk spreads won't compress and they'll be forced into asset-liability management," Schuartzman said, Bloomberg News relays. Some investors saw a first signal from the Central Bank when it cut the one-day peso repo rate by 10 percentage points to 25 percent, Bloomberg News discloses. The decision came as the peso was trading around 1,330 per dollar, leading many to interpret that level as the new, implicit floor of the band, Bloomberg News says. "The government must use the current moment to rebuild genuine reserves, making clear that US funds will be reserved for debt service, not FX defence," said Juan Manuel Pazos, chief economist at broker One618, in a report to investors, Bloomberg News adds. About Argentina Argentina is a country located mostly in the southern half of South America. Its capital is Buenos Aires. Javier Milei is the current president of Argentina after winning the November 19, 2023 general election. He succeeded Alberto Angel Fernandez in the position. Argentina has the third largest economy in Latin America. The country's economy is an upper middle-income economy for fiscal year 2019, according to the World Bank. Historically, however, its economic performance has been very uneven, with high economic growth alternating with severe recessions, income maldistribution and in the recent decades, increasing poverty. In March 2022, the International Monetary Fund (IMF) approved a 30-month arrangement under an Extended Fund Facility for Argentina in the amount of SDR 31.914 billion (equivalent to US$44 billion, or 1000 percent of quota) -- with an approved immediate disbursement of an equivalent of US$9.65 billion. Argentina's IMF-supported program sought to improve public finances and start to reduce persistent high inflation through a multi-pronged strategy. On April 11, 2025, the IMF further approved a 48-month Extended Fund Facility (EFF) arrangement for Argentina totaling US$20 billion (or 479 percent of quota), with an immediate disbursement of US$12 billion, and a first review planned for June 2025 with an associated disbursement of about US$2 billion. The program is expected to help catalyze additional official multilateral and bilateral support, and a timely re-access to international capital markets. Fitch Ratings, on May 12, 2025, upgraded Argentina's Long-Term Foreign-Currency and Local-Currency Issuer Default Rating (IDR) to 'CCC+' from 'CCC'. The upgrade reflects the launch of a new IMF program, among other things. S&P Global Ratings, in February 2025 lowered its local currency sovereign credit ratings on Argentina to 'SD/SD' from 'CCC/C' and its national scale rating to 'SD' from 'raB+'. Moody's Ratings, in January 2025, raised Argentina's local currency ceiling to B3 from Caa1 and the foreign currency ceiling to Caa1 from Caa3. DBRS, Inc. upgraded Argentina's Long-Term Foreign and Local Currency Issuer Ratings to B (low) from CCC in November 2024. ARGENTINA: Poverty Falls to Lowest Level Since 2018 --------------------------------------------------- Patrick Gillespie at Bloomberg News reports that poverty in Argentina fell sharply to its lowest level since 2018 as President Javier Milei's policies brought down inflation from triple-digit territory, an accomplishment that could help his party regain some momentum with voters before October midterm elections. In the first half of the year, 31.6 percent of Argentines lived in poverty, down from nearly 53 percent in the early months of Milei's Presidency a year ago, according to data published by Argentina's INDEC national statistics bureau, according to Bloomberg News. A combination of Milei's austerity, currency controls and tight monetary policy thwarted the pace of price increases at the start of the year, helping to bring more people out of poverty, which is defined locally as incomes that can afford the cost of a basic basket of goods and services, Bloomberg News notes. Milei lifted some FX controls in April when his government received a US$20-billion programme from the International Monetary Fund, but the peso didn't devalue significantly and inflation continued to cool, Bloomberg News relays. Still, Milei's advances against poverty haven't been enough to keep voters on his side before the October 26 midterms when Argentina renews nearly half the seats in Congress, Bloomberg News discloses. His party lost a key vote in Buenos Aires Province where poverty tends to be more elevated than the national average, a few weeks ago, Bloomberg News says. That sparked a market sell-off that eventually led the USnited States to step and signal an additional US$20-billion financial rescue, Bloomberg News notes. More broadly, Argentina's recovery from Milei's austerity at the outset of his presidency has stagnated recently with economic activity contracting for three straight months through July, Bloomberg News notes. Unemployment remains elevated and informal jobs, which tend to have lower salaries and fewer job protections, have increased much more than formal, salaried jobs. Bloomberg News adds. About Argentina Argentina is a country located mostly in the southern half of South America. Its capital is Buenos Aires. Javier Milei is the current president of Argentina after winning the November 19, 2023 general election. He succeeded Alberto Angel Fernandez in the position. Argentina has the third largest economy in Latin America. The country's economy is an upper middle-income economy for fiscal year 2019, according to the World Bank. Historically, however, its economic performance has been very uneven, with high economic growth alternating with severe recessions, income maldistribution and in the recent decades, increasing poverty. In March 2022, the International Monetary Fund (IMF) approved a 30-month arrangement under an Extended Fund Facility for Argentina in the amount of SDR 31.914 billion (equivalent to US$44 billion, or 1000 percent of quota) -- with an approved immediate disbursement of an equivalent of US$9.65 billion. Argentina's IMF-supported program sought to improve public finances and start to reduce persistent high inflation through a multi-pronged strategy. On April 11, 2025, the IMF further approved a 48-month Extended Fund Facility (EFF) arrangement for Argentina totaling US$20 billion (or 479 percent of quota), with an immediate disbursement of US$12 billion, and a first review planned for June 2025 with an associated disbursement of about US$2 billion. The program is expected to help catalyze additional official multilateral and bilateral support, and a timely re-access to international capital markets. Fitch Ratings, on May 12, 2025, upgraded Argentina's Long-Term Foreign-Currency and Local-Currency Issuer Default Rating (IDR) to 'CCC+' from 'CCC'. The upgrade reflects the launch of a new IMF program, among other things. S&P Global Ratings, in February 2025 lowered its local currency sovereign credit ratings on Argentina to 'SD/SD' from 'CCC/C' and its national scale rating to 'SD' from 'raB+'. Moody's Ratings, in January 2025, raised Argentina's local currency ceiling to B3 from Caa1 and the foreign currency ceiling to Caa1 from Caa3. DBRS, Inc. upgraded Argentina's Long-Term Foreign and Local Currency Issuer Ratings to B (low) from CCC in November 2024. CORDOBA: Fitch Affirms 'CC' IDRs -------------------------------- Fitch Ratings has affirmed the municipality of Cordoba's (Cordoba) Long-Term Local Currency Issuer Default Rating (IDR) at 'CC' and its Long-Term Foreign Currency IDR at 'CC'. Fitch relied on its rating definitions to align Cordoba's ratings and 'cc' Standalone Credit Profile (SCP). The affirmation of the Local Currency IDR reflects Fitch's reassessment of the municipality's SCP at 'cc', which indicates that some form of default is probable within the next 12 months. The affirmation also incorporates acute liquidity pressure driven by recurring financial deficits and a heavy concentration of short‑term maturities, elevating refinancing risk in a volatile and constrained local market. Fitch believes Cordoba faces very high credit risk to meet debt service over the next year, even assuming capital spending remains at historically low levels. Key Rating Drivers Risk Profile - Vulnerable: Fitch evaluated Cordoba's risk profile as 'Vulnerable,' reflecting the combination of six Key Risk Factors (KRFs) assessed as 'Weaker'. Revenue Robustness - 'Weaker': The 'Weaker' assessment reflects Argentina's complex and imbalanced fiscal framework and Cordoba's relatively high dependence on transfers. This dependence stems from exposure to a 'CCC+' sovereign counterparty (Argentina) and a 'B-' provincial counterparty (province of Cordoba), which together account for 37% of operating revenue on a three-year average. This occurs amid an adverse macroeconomic environment characterized by high inflation. For 2025, Fitch projects a 4.1% increase in Cordoba's inflation-adjusted operating revenue, driven by provincial transfers and fiscal policies. Revenue Adjustability - 'Weaker': Fitch's 'Weaker' assessment reflects Cordoba's limited capacity to generate additional revenue during economic downturns — a challenge shared by all Fitch-rated Argentine local and regional governments (LRGs). Local revenue adjustability is low given the country's large and distortive tax burden. The adverse macroeconomic environment further constrains Cordoba's ability to raise tax rates and broaden tax bases to lift local operating revenue. Persistently high inflation continues to erode real-term revenue growth and pressure household affordability. In its rating case, Fitch expects operating revenue to grow at a rate above average inflation in 2024. Expenditure Sustainability - 'Weaker': Fitch's 'Weaker' assessment of Argentina's expenditure sustainability reflects the country's structurally imbalanced fiscal framework in terms of revenue-expenditure decentralization. Over the past five years, spending has been heavily influenced by high inflation and substantial expenditure responsibilities. Cordoba bears significant responsibility for providing public services — including education and healthcare — that are typically delivered at the provincial level. Cordoba's operating margin averaged 15% over the past five years, and Fitch projects a three-year average of 13% under its rating case. As of June 2025, the operating balance has improved, driven by effective containment of operating expenditures and lower capital spending. However, Cordoba has posted financial deficits over the last five years, with a five-year average of -4%. In the rating case, Fitch projects an average financial result of -4% for 2025-2027. Expenditure Adjustability - 'Weaker': The 'Weaker' assessment reflects that Argentine subnationals face large infrastructure needs and heavy expenditure responsibilities, with limited flexibility to reduce costs. National capital spending is low and insufficient, pushing more of the capex burden onto LRGs. Fitch views Cordoba's capacity to cut expenses as weaker relative to international peers. Between 2022 and 2024, capex averaged 19% of total expenditure. As of December 2024, it has contracted markedly to 12%. In its rating case, Fitch projects an average capex of 11.5% for 2025-2027. However, actual capex execution will depend on securing the necessary financing. Liabilities and Liquidity Robustness - 'Weaker': The 'Weaker' assessment underscores key vulnerabilities: exposure to unhedged foreign-currency debt, a weak national framework for debt and liquidity management, and an underdeveloped domestic capital market. It also factors in the sovereign's 'CCC+' rating and the debt restructuring, which has constrained external market access for LRGs. Cordoba faces pronounced liquidity pressures due to a heavy concentration of debt maturities over the next 12 months across both local and external markets. These pressures are compounded by a weak liquidity position, reflecting average financial deficits in the past years. The combination of strained liquidity, persistent deficits, and a high share of short-term maturities leaves Cordoba exposed to significant refinancing risk amid a volatile and constrained local market. Consequently, the entity exhibits very high credit risk with respect to meeting debt service over the next year, even if capex remains at historically low levels. In March 2025, Cordoba incurred additional debt comprising ARS32 billion in short-term Treasury notes (series LII) and ARS50 billion in long-term debt via 2025 notes (series I). This, combined with a financing strategy in the local market, temporarily alleviates liquidity pressures. In total, the entity is authorized to expand its long-term financing up to ARS155 billion in 2025. Liabilities and Liquidity Flexibility - 'Weaker': Fitch assesses Argentina's national framework for subnational liquidity support and funding as 'Weaker', reflecting the lack of formal emergency liquidity facilities or bailout mechanisms. As a result, Argentine LRGs largely depend on their own unrestricted cash for liquidity. Cordoba's liquidity coverage ratio stood at 1.2x at end-2024. The current regime of national capital controls is an additional risk captured in the liquidity flexibility assessment, as exchange restrictions could ultimately impede LRGs' ability to meet financial obligations. Financial Profile - 'aa' category: Cordoba's 'aa' financial profile score incorporates a 'aaa' payback ratio projected at 1.6x for 2025 under Fitch's rating case. An override is applied to the 'aaa' payback ratio score because the actual debt service coverage ratio (ADSCR) is estimated at 0.7x in 2025 (a 'b' score). These financial profile metrics inform Fitch's view of Cordoba's debt repayment capacity and its liquidity position over the next 12 months. The overall 'aa' financial profile score is supported by the medium-term maturity profile of debt, while also reflecting high refinancing risks stemming from a 'CCC+' macroeconomic environment with significant transfer and convertibility risks. Given Argentina's sovereign 'CCC+' FC IDR and limited access to external markets amid a volatile macroeconomic and regulatory backdrop, Fitch's projections emphasize the year-end 2025 scenario. Derivation Summary Cordoba's SCP of 'cc' is derived from a 'Vulnerable' Risk Profile and a 'aa' financial profile score, but it also reflects a very high level of credit risk, including the risk that a default of some kind is 'probable' within the next 12 months. The SCP considers comparison with peers, including the provinces of Chubut, Neuquen and Chaco. Fitch does not apply any asymmetric risk or extraordinary support from upper-tier government. The rating is based on Fitch's rating definitions. Cordoba's FC IDR positioning reflects challenges ahead that could hinder its repayment capacity, such as transfer and convertibility risks and the inability to access external markets to address financing needs. Both IDRs reflect exposure to macroeconomic counterparty risks and an unpredictable regulatory framework. Issuer Profile The municipality of Cordoba is the capital of the province of Cordoba (B-/Stable) and the second-largest city in Argentina (CCC+), after Buenos Aires (B-/Stable). The city is one of the nation's most important social, educational and economic centers, supporting strong local tax revenue collection from commerce and industry. Key Assumptions Fitch's rating case is a through-the-cycle scenario, which incorporates a combination of revenue, cost and financial risk stresses. It is based on 2020-2024 figures and 2025-2027 projected ratios. The key assumptions for the scenario include: - Average operating revenue growth of 29.3% for 2025-2027, 2025 in line with inflation and GDP growth, and 2026 and 2027 in line with expected inflation; - Average operating expenditure growth of 28.8% for 2025-2027, 2025 in line with inflation, and 2026 and 2027 in line with inflation and GDP growth; - Operating margin declines from 14.4% in 2025 to about 11.8% in 2027; - Average capex to total expenditure of around 11.5%, higher than the 10.3% recorded in 2020; - Cost of debt reflects non-cash debt movements from currency depreciation, assuming an average exchange rate of ARS1,191 per U.S. dollar in 2025, ARS1,458 in 2026, and ARS1,668 in 2027; - Consumer price inflation (annual average percentage change) of 43.8% for 2025, 22.6% for 2026, and 16.5% for 2027; - Direct debt figures for 2025 include ARS51 billion in short-term debt and ARS190 billion in long-term debt. RATING SENSITIVITIES Factors that Could, Individually or Collectively, lead to Negative Rating Action/Downgrade - Signs of deeper liquidity stress that could compromise short-term debt repayment capacity include rising refinancing risk in both local and foreign currency debt, as well as any regulatory restrictions on access to foreign exchange; - Indications of any credit event that reflects a near-default situation, including a distressed debt exchange (DDE) under Fitch's rating definitions. Factors that Could, Individually or Collectively, lead to Positive Rating Action/Upgrade - Reduction in perceived refinancing risk, together with an improved liquidity position, while maintaining debt service coverage above 1.0x under Fitch's rating case. ESG Considerations Cordoba has an ESG Relevance Score of '4' for Rule of Law, Institutional and Regulatory Quality, Control of Corruption, reflecting the negative impact the weak regulatory framework and national policies of the sovereign have over the municipality in conjunction with other factors. Cordoba has an ESG Relevance Score of '4' for Creditor Rights, reflecting that despite the issuer's improved willingness to service and repay its debt obligations, the latest DDE continues to weigh on its credit profile and debt coverage is expected to remain pressured; therefore, the issue of Creditor Rights remains relevant to the rating in conjunction with other factors. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- Cordoba, Municipality of LT IDR CC Affirmed CC LC LT IDR CC Affirmed CC [] ARGENTINA: 'Is Moving In The Right Direction,' IMF Says ---------------------------------------------------------- Buenos Aires Times reports that International Monetary Fund (IMF) managing director Kristalina Georgieva says Argentina "is moving in the right direction." The head of the multilateral lender made her remarks after meeting with President Javier Milei on the sidelines of the UN General Assembly in New York, according to Buenos Aires Times. "It was an excellent get-together, we'll be meeting again," pointed out the IMF chief in press statements, the report notes. The report relays that Georgieva highlighted the support of the United States and the World Bank, assuring that what Argentina is doing "is very significant." "The fiscal discipline, the monetary policy and the structural reforms are very important," she maintained, the report discloses. Buenos Aires Times relays that the Bulgarian economist wished the country "all the best," highlighting that "the things which reach those below must stay on track," where she mentioned lower poverty and inflation figures while "the things on the rise must continue to do so," singling out economic activity, which has registered a fall.. "All support is very important and positive," concluded Georgieva. Shortly afterwards, a message posted on her social networks, described the meeting with the Argentine leader as "very constructive," the report relays. "We stand with Argentina as it implements policies to safeguard stability, reduce inflation, rebuild reserves and boost growth prospects," she added. World Bank After the meeting between Milei and US President Donald Trump, the World Bank announced a new loan of US$4 billion for Argentina, which will reach Central Bank coffers in the next few months, the report relays. The credit aims at financing the private sector in a context of scant hard currency, the report notes. "The World Bank announced that it is accelerating its support for Argentina, combining financing the public sector with mobilising private-sector investment by deploying up to US$4 billion in the next few months to back the agenda of reforms and the country's long-term growth," the international credit organisation commented, the report discloses. Buenos Aires Times discloses that at the same time, it pointed out that support is destined "to boost mining, critical minerals and tourism as a source of jobs and local development, broadening access to energy and grids and financing the PyMEs small and medium-sized firms." "This support advances on the support package of US$12 billion announced in April and reflects the firm confidence in the efforts of the government to modernise the economy, undertake structural reforms, attract private investment and create jobs," World Bank sources indicated, the report notes. The Grupo Banco Interamericano de Desarrollo (Grupo BID) also communicated "it is working to significantly expand its operations in Argentina in the next 15 months to increase its support for the country" in line with the IMF program, the report relays. By the end of the year, the Grupo BID plans to approve five new operations for the public sector for a total of US$ 2.9 billion, destined to back structural reforms, as well as a further US$1 billion via BID Invest aimed at strategic sectors, the report adds. About Argentina Argentina is a country located mostly in the southern half of South America. Its capital is Buenos Aires. Javier Milei is the current president of Argentina after winning the November 19, 2023 general election. He succeeded Alberto Angel Fernandez in the position. Argentina has the third largest economy in Latin America. The country's economy is an upper middle-income economy for fiscal year 2019, according to the World Bank. Historically, however, its economic performance has been very uneven, with high economic growth alternating with severe recessions, income maldistribution and in the recent decades, increasing poverty. In March 2022, the International Monetary Fund (IMF) approved a 30-month arrangement under an Extended Fund Facility for Argentina in the amount of SDR 31.914 billion (equivalent to US$44 billion, or 1000 percent of quota) -- with an approved immediate disbursement of an equivalent of US$9.65 billion. Argentina's IMF-supported program sought to improve public finances and start to reduce persistent high inflation through a multi-pronged strategy. On April 11, 2025, the IMF further approved a 48-month Extended Fund Facility (EFF) arrangement for Argentina totaling US$20 billion (or 479 percent of quota), with an immediate disbursement of US$12 billion, and a first review planned for June 2025 with an associated disbursement of about US$2 billion. The program is expected to help catalyze additional official multilateral and bilateral support, and a timely re-access to international capital markets. Fitch Ratings, on May 12, 2025, upgraded Argentina's Long-Term Foreign-Currency and Local-Currency Issuer Default Rating (IDR) to 'CCC+' from 'CCC'. The upgrade reflects the launch of a new IMF program, among other things. S&P Global Ratings, in February 2025 lowered its local currency sovereign credit ratings on Argentina to 'SD/SD' from 'CCC/C' and its national scale rating to 'SD' from 'raB+'. Moody's Ratings, in January 2025, raised Argentina's local currency ceiling to B3 from Caa1 and the foreign currency ceiling to Caa1 from Caa3. DBRS, Inc. upgraded Argentina's Long-Term Foreign and Local Currency Issuer Ratings to B (low) from CCC in November 2024. =========== B R A Z I L =========== BRAZIL: Banks Outweigh Mining Giants in Market's Balancing Act -------------------------------------------------------------- Rio Times Online reports that Brazil's stock market closed slightly higher as domestic banks offset weakness in the country's commodity giants, reflecting a deeper story about Latin America's largest economy navigating between old strengths and new realities. The Bovespa index gained 0.10% to 145,447 points, but the modest advance masked significant crosscurrents beneath the surface, according to Rio Times Online. Vale, the mining giant that helped power Brazil's commodity boom, dropped 1.92% as iron ore prices fell in China, the report notes. Petrobras, the state oil company, declined 0.34% despite rising global crude prices, showing how domestic factors increasingly drive Brazilian stocks independent of international commodity trends, the report relays. Banks provided the session's strength. Banco do Brasil surged 1.47% while Santander Brasil rose 2.31% after announcing share buybacks, the report discloses. The report notes that the financial sector's resilience reflects Brazil's elevated 15% interest rates, which squeeze borrowers but boost bank profits, the report relays. This contrasts sharply with the United States, where the Federal Reserve maintains rates near 4.5% and signals potential cuts, the report says. Rio Times Online discloses that airlines dominated the day's biggest movers after Azul and Gol announced their merger talks had collapsed. Azul shares rocketed 17.14% while Gol gained 5.31%. The end of merger negotiations relieved investor concerns about complex restructuring amid both companies' financial difficulties, the report relays. Meanwhile, Braskem's 14.81% collapse tells a darker story, the report notes. The petrochemical company hired advisors to review capital structure options, raising bankruptcy concerns, the report discloses. The stock hit levels not seen since March 2015, highlighting how some Brazilian companies struggle with high borrowing costs and global competition, the report says. The divergence creates an unusual dynamic, the report says. Brazil's real has strengthened 14.25% against the dollar this year, making it one of the world's best-performing currencies, the report relays. International investors earn dramatically more parking money in Brazilian bonds than U.S. assets, driving capital flows that support both the currency and banking stocks, the report notes. Technical indicators show the market at a crossroads. The index trades 77% of the way between its monthly low of 139,582 points and high of 147,178 points, the report discloses. The report relays that trading volume remains below average at 6.3 million shares, suggesting cautious participation despite the upward trend. Brazil's economy faces competing pressures. Unemployment dropped to 5.6% in July, the lowest since records began in 2012. More than 102 million Brazilians now work, a historic high, the report relays. Yet economic activity declined for three consecutive months through July as high interest rates cool growth, the report says. The central bank maintains its restrictive stance to combat inflation running above the 3% target, the report notes. Core inflation measures remain elevated despite recent cooling, forcing policymakers to prioritize price stability over growth, the report says. Economists now forecast gradual rate cuts to 12.25% by late 2026, down from earlier projections, the report discloses. Global factors add complexity. China's iron ore demand remains uncertain, pressuring Vale and similar mining companies, the report relays. U.S. trade policies under President Trump could affect Brazilian exports, though Brazil's trade relationship with China provides some insulation, the report notes. The market's current setup reflects Brazil's transition from a pure commodity play to a more diversified economy, the report relates. Banking stocks benefit from high rates while mining companies face global headwinds, the report notes. Service sectors show resilience as domestic consumption remains solid despite monetary tightening, the report says. The mixed performance captures this balancing act perfectly. Financial strength offset commodity weakness, producing a small gain that masks larger structural shifts in Brazil's economy and financial markets, the report adds. About Brazil Brazil is the fifth largest country in the world and third largest in the Americas. Luiz Inacio Lula da Silva won the 2022 Brazilian general election. He was sworn in on January 1, 2023, as the 39th president of Brazil, succeeding Jair Bolsonaro. In October 2024, Moody's Ratings upgraded the Government of Brazil's long-term issuer and senior unsecured bond ratings to Ba1 from Ba2, the senior unsecured shelf rating to (P)Ba1 from (P)Ba2; and maintained the positive outlook. S&P Global Ratings raised on Dec. 19, 2023, its long-term global scale ratings on Brazil to 'BB' from 'BB-'. Fitch Ratings affirmed on Dec. 15, 2023, Brazil's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB' with a Stable Outlook. DBRS' credit rating for Brazil was last reported at BB with stable outlook at July 2023. FS INDUSTRIA: Fitch Affirms 'BB-' LongTerm Currency IDRs -------------------------------------------------------- Fitch Ratings has affirmed FS Industria de Biocombustiveis Ltda's (FS) Long-Term Local and Foreign Currency Issuer Default Ratings (IDR) at 'BB-' and affirmed its Long-Term National Scale rating at 'AA-(bra)'. The Rating Outlooks for all corporate ratings are Stable. Fitch has also affirmed at 'BB-' the 2031 and 2033 senior unsecured notes issued by fully-owned FS Luxembourg S.a r.l. guaranteed by FS. The ratings incorporate FS' large-scale production in the volatile Brazilian ethanol industry and the lack of meaningful short-term price correlation between corn and ethanol. The ratings and the Outlooks also incorporate FS's ability to maintain satisfactory financial flexibility and Fitch's expectation that EBITDA net leverage of the group (including sister companies) will be around 3.5x during the construction of a BRL2 billion new corn ethanol plant due to favorable ethanol and corn prices assumptions for fiscal YE 2026 and fiscal YE 2027. Key Rating Drivers Large Ethanol Producer: FS benefits from a sizable production capacity of approximately 2.5 billion liters of ethanol and a robust corn supply from neighboring areas, allowing for price discounts relative to Chicago Board of Trade (CBOT). Animal nutrition products provide a partial hedge, as their prices strongly correlate with regional corn and soybeans prices. Fitch expects revenues from these products to cover up to 50% of feedstock costs in the long term. FS' industrial plants in Mato Grosso, Brazil's largest corn producing state, mitigates corn origination risks. The new corn ethanol mill, due by fiscal YE 2028, will add 540 million liters of ethanol per year and 390 tons of DDG, strengthening FS's scale and market position. Weaker Corn and Ethanol Prices Correlation: FS faces price volatility for both corn, its main raw material, and ethanol, its main output with low correlation. Corn prices adjust rapidly to global supply and demand imbalances, while Brazilian ethanol prices largely depend on local gasoline prices set by Petrobras, which are influenced by the Brent crude prices in BRL. Additionally, ethanol prices are indirectly influenced by sugar prices, as approximately 80% of local ethanol production comes from sugarcane. The base case assumes international corn prices of USD4.40 per bushel in 2025 and 2026 and average ethanol prices at BRL2.85/liter for fiscal YE 2026. Operating Cash Flow to Recover: Fitch expects EBITDA of BRL3.3 billion and cash flow from operations (CFO) of BRL1,089 million in fiscal YE 2026. This represents an improvement compared to fiscal YE 2025 EBITDA of BRL2.5 billion and CFO of BRL930 million in fiscal YE 2025. Higher ethanol prices and relatively competitive and stable corn prices should support higher EBITDA margin at around 31%, up from 24% in fiscal YE 2025 and 9% in fiscal YE 2024. Fitch projects negative FCF for fiscal 2026 and fiscal 2027, due to the new plant investments. The base case assumes dividends of BRL550 million in fiscal 2026 and BRL290 million in fiscal 2027. Group Structure and Related Parties: Fitch's updated relevance score of group structure to '4' to reflect increasing related-party transactions with FS Florestal S.A. and FS Infraestrura S.A., which are not included in the combined financial statements of FS. Besides the partial guarantees that FS provides to these entities, there is debt at FS Florestal that is guaranteed by long-term commercial agreements between both companies. Fitch adjusted FS debt by adding BRL2.5 billion tied to sister companies. EBITDA Net Leverage around 3.5x: Fitch projects that adjusted net leverage will be around 3.5x in fiscal 2026, driven by higher volumes and increased EBITDA margins due to relatively stable corn costs and higher-than-expected ethanol prices. Fitch base case considers that EBITDA net leverage of FS will peak at 3.7x in fiscal 2027, reducing to around 3.0x in fiscal 2028 when the new plant starts to operate. Peer Analysis FS's IDR of BB-/Stable is at the same level of Ingenio Magdalena S.A. (IMSA, BB-/Stable). IMSA has a more stable cash flow profile compared to corn-based ethanol producer FS, which is more exposed to commodity price fluctuations in terms of both raw material and product price. On the other hand, IMSA has tight liquidity and lower scale in terms of revenues, EBITDA and lower financial flexibility. FS has access to Local and International Bonds market and with longer debt maturities. FS's AA-(bra)/Stable is two notches above Acucareira Quata S.A. (Zilor, A(bra)/Positive). FS has stronger liquidity and financial flexibility than Zilor and satisfactory access to the domestic and international capital markets. FS' lower maintenance capex supports more robust FCFs compared with Zilor in a no-growth capex scenario. Key Assumptions - Ethanol production capacity of 2.5 billion liters in fiscal 2026 and 2.8 billion in fiscal 2027; - Sales of animal nutrition products of over 2.3 million tons in fiscal 2026 and 2.6 million in fiscal 2027; - Ethanol prices to vary in tandem with a combination of oil prices and FX rates. Brent crude prices have been forecast to average USD70/bbl in 2025 and USD65/bbl in 2026; - End of Period FX rates of BRL5.60/USD in 2025 and BRL5.70/USD in 2026; - Animal nutrition products providing around 50% coverage for total corn costs; - Total investments of BRL1.8 billion in fiscal 2026 and BRL1.2 billion in fiscal 2027; - Dividends of BRL550 million in fiscal 2026 and BRL290 million in fiscal 2027. RATING SENSITIVITIES Factors That Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - Deterioration in liquidity and/or difficulties to refinance short-term debt; - EBITDA margins below 20% on a sustained basis; - Combined EBITDA net leverage (including sister companies' debt) above 3.5x on a sustained basis. Factors That Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - Longer positive track record in different cycles of ethanol and corn prices; - FCF consistently positive, with the maintenance of combined EBITDA net leverage (including sister companies' debt) below 2.0x through the cycle; - EBITDA interest coverage above 2.5x. Liquidity and Debt Structure FS has satisfactory liquidity and financial flexibility. As of June 30, 2025, the company reported cash and marketable securities of BRL3.9 billion and total debt of BRL13.0 billion, including reverse factoring transactions, guarantees to sister companies and net FX and IRS (Interest Rate Swaps). Excluding reverse factoring and derivatives, the company has BRL1.2 billion of debt maturing in the short term. FS' has good access to the banking and the local and foreign capital markets and has a relatively lengthened debt maturity schedule, with most of its debt due in 2029 onwards, including the USD350 million 2031 and USD500 million 2033 bonds. Issuer Profile FS operates three plants in Mato Grosso, producing corn-based ethanol, DDG for animal nutrition, corn oil, and energy. The plants have a total capacity to crush 5.1 million tons of corn and produce 2.5 billion liters of ethanol. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Macro and Sector Forecasts data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations FS Industria de Biocombustiveis Ltda. has an ESG Relevance Score of '4' for Group Structure due to the increase of operations of two sister companies FS Infraestrura S.A. and FS Florestal S.A., companies that have commercial relationship with FS Group, but are not included in the combined figures due to different shareholders or businesses, which has a negative impact on the credit profile, and is relevant to the ratings in conjunction with other factors. The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating Prior ----------- ------ ----- FS Industria de Biocombustiveis Ltda. LT IDR BB- Affirmed BB- LC LT IDR BB- Affirmed BB- Natl LT AA-(bra)Affirmed AA-(bra) FS Luxembourg S.a r.l. senior unsecured LT BB- Affirmed BB- OCEANICA ENGENHARIA: Sec. Notes Add-on No Impact on Moody's B3 CFR ------------------------------------------------------------------ Moody's Ratings commented that Oceanica Engenharia e Consultoria S.A. (Oceanica)'s B3 Corporate Family Rating, the B3 rating of the senior secured notes due 2029 issued by Oceanica LUX and fully and unconditionally guaranteed by Oceanica and negative outlook remain unchanged following the company's announcement that it plans to issue an add-on to its senior secured notes due 2029. This transaction will be a $150 million add-on to the original $375 million notes issued in October 2024 by Oceanica LUX and fully and unconditionally guaranteed by Oceanica. Net proceeds from the proposed issuance will be used primarily for debt prepayment, thus not affecting the company's debt protection metrics. The transaction is part of Oceanica's liability management strategy and proceeds will be partially used for debt prepayment, including prepayment of debt maturing mostly in 2025 and 2026, and for general corporate purposes, thus improving liquidity while lengthening the company's debt amortization schedule further. Oceanica's B3 rating is supported by its scale and leading market position in the Brazilian offshore services industry, long-term relationship with its main customer Petroleo Brasileiro S.A. - PETROBRAS (Petrobras, Ba1 stable), and firm backlog of contracts that provides cash flow visibility through 2027. The company had a fleet of 17 vessels and 55 remotely operated vehicles (ROV) at the end of June 2025 with an average vessel fleet age of 17 years and a firm backlog of BRL8.8 billion, and benefits from contractual protections and from the specialized, mission-critical nature of its service that provides track record of operating profitably through commodity price cycles. The company is benefitting from increasing demand in its offshore energy business in Brazil while pursuing growth in other business segments in the offshore industry. The rating is also supported by the company's improving credit metrics and liquidity related to the ramp up of its service contracts. The rating is constrained by Oceanica's small size and concentrated operations compared to those of its peers, its exposure to re-contracting and repricing risks despite the track record of no contract cancellation with Petrobras, its growth strategy and the capital intensity of its business. The largely encumbered asset base and high funding cost also limits the rating, as well as the lack of track record of prudent capital allocation through investment cycles. The company's weakened credit metrics and liquidity after the transition and mobilization of several assets in 2024 also constrains the rating. Oceanica's total debt will continue to increase as the company pursues its growth strategy on the Brazilian offshore market, although any fleet expansion would be tied to the signing of new contracts. As new contracts ramp up, Oceanica will generate annual cash flow from operations of BRL350 million, which will be sufficient to cover CAPEX requirements in a capped amount of BRL350 million as per its notes indentures. Oceanica has weak liquidity, with around BRL169 million in cash and BRL431 million in debt maturing until the end of 2026, compared to Moody's previous expectations of BRL900 million in cash and only one debt instrument maturing in 2029. Pro forma to the notes add-on, Oceanica will have BRL542 million in cash and BRL50 million in debt maturing until the end of 2026, but the company will still face significant debt maturities of BRL272 million (excluding the credit-linked debentures) in 2027. Moody's expects the company's cash flow from operations to amount to around BRL300-400 million per year from 2025 onwards, which is sufficient to cover maintenance investment requirements in its fleet, however the company will continue to rely on external funding to fund fleet growth. The company's notes due 2029 have incurrence covenants setting a maximum net leverage of 4.5x in 2024, gradually declining to 2.5x from 2026 onwards, and limit dividend payments to 50% of net income and capex to BRL350 million per year. Moody's expects the company to maintain a disciplined approach to capital allocation, including dividend distributions, as it starts to increase its cash from operations. Moody's also expects Oceanica to pursue additional liability management initiatives to address upcoming debt maturities and increase its cash position. Oceanica's $375 million senior secured notes are rated at the same level as the company's B3 CFR, reflecting the instrument's collateral package, which includes a first-priority security interest on specific equipment, receivables, collateral account, vessels, DSRA and escrow account. The senior notes represent 87% of Oceanica's debt. The notes contain a pledge of the lower of: i) 70% of company's receivables or ii) 2x the outstanding principal amount, tested quarterly, and will have leverage-based cash flow sweeps. The negative rating outlook reflects Oceanica's high liquidity risks and the ongoing ramp up of credit metrics and liquidity related to existing contracts and additional liability management initiatives. Given the negative rating outlook, an upgrade is unlikely in the short term. Longer term, Oceanica's rating could be upgraded if the company is able to execute its existing backlog and build an operational and financial track record, while continuing to secure contract's renewal and growth, and significantly increase its scale. Quantitatively, the rating could be upgraded if the company's maintains debt-to-EBITDA remains below 3.5x (5.3x in the twelve months ended June 2025), improves its free cash flow generation, increases interest coverage (EBITDA/interest) to above 2.5x (0.9x in the twelve months ended June 2025) and maintains at least adequate liquidity. The failure to successfully complete additional liability management initiatives and reinforce its cash balance and reduce liquidity risks would trigger a downgrade of the rating. Oceanica's rating could also be downgraded if the company's liquidity deteriorates or if leverage (measured by debt-to-EBITDA) is sustained above 4.5x. Change in financial policy, such as using significant amounts of debt for growth or dividend payments, could also lead to a downgrade. Headquartered in Rio de Janeiro, Brazil and founded in 1978, Oceanica is a leading provider of prevention, contingency and engineering services to the offshore oil and gas industry in Brazil. The company operates a fleet of 55 ROVs and 17 support vessels with an average fleet age of 17 years. The company generates the totality of its revenue in Brazil and mostly through contracts with Petrobras, and related to prevention services (70% of revenues), followed by engineering (20%) and contingency services (10%). In the twelve months ended June 2025, the company reported revenue of BRL1.5 billion with a Moody's-adjusted EBITDA margin of 30.7%. VAMOS LOCACAO: Fitch Assigns 'BB-' LongTerm IDR, Outlook Stable --------------------------------------------------------------- Fitch Ratings assigned Vamos Locacao de Caminhoes, Maquinas e Equipamentos SA (Vamos) 'BB-' Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs). The Rating Outlook is Stable. Fitch also assigned a 'BB-' rating to proposed benchmark-size senior unsecured notes due 2031, to be issued by Vamos Europe and guaranteed by Vamos. Proceeds will be used for refinancing purposes. Vamos' ratings are equalized with Simpar S.A. (BB-/Stable), reflecting Simpar's medium legal and strong operational/strategic incentives to support Vamos. Simpar's ratings incorporate a leveraged capital structure, elevated gross capex, and lower returns on invested capital, which constrain EBITDA-to-cash conversion and hinder deleveraging. On a standalone basis, Vamos holds a solid position in Brazil's heavy vehicles, machinery, and equipment leasing market, with meaningful scale and consistent performance. Nevertheless, expected negative free cash flow should keep leverage in the moderate-to-high range. Liquidity is adequate, and the company manages its debt amortization profile appropriately. Key Rating Drivers Parent-Subsidiary Linkage: Vamos's rating reflects Simpar's medium legal incentives and strong operational and strategic incentives to support the subsidiary, leading to equalized ratings. Beyond Simpar's cross-default clauses and significant ownership control, Vamos has strong growth potential and important commercial synergies with the group, enhancing Simpar's strong bargaining power with clients and suppliers and in asset purchases. Simpar's controlling shareholders and executives make up most of Vamos' Board of Directors. Group With Strong Business Profile: Simpar's large scale and leading position in the Brazilian rental and logistics industry provide a competitive advantage in asset purchases and operating costs compared with peers. The group's diversified service portfolio and presence across multiple sectors also support its credit profile. Simpar' strategic and operational role, competitive cost structure and revenue stream based on long-term contracts for most of its rental and logistics businesses minimize exposure to Brazil's more volatile economic cycles. Simpar's credit quality incorporate the business profiles of its main subsidiaries, Movida Participações S.A. (Movida; BB-/Stable), JSL S.A. (BB-/Stable), and Vamos. Vamos is the most profitable, accounting for 10% of the Group's revenues, but 33% of the EBITDA, while Movida and JSL accounted for approximately 45% and 15%, respectively. Leadership Position: Vamos's business profile benefits from its leadership in a still-underpenetrated and highly fragmented sector, which provides opportunities to scale up. As Brazil's largest lessor of heavy vehicles, machinery, and equipment, Vamos has strong bargaining power with suppliers, further bolstered by the group's strength, solid operating performance, nationwide presence, and an adequate used-asset retail operation. In June 2025, Vamos's rental fleet of 52,544 assets comprised 41,126 heavy vehicles (including truck tractors, trailers, light commercial vehicles, and buses) and 11,418 machines and equipment. Group's Credit Metrics: Simpar has a leveraged capital structure and Fitch forecast consolidated net adjusted debt/adjusted EBITDA to remain around 4.6x in 2025 and 2026. Net debt rose consistently to BRL50.5 billion in June 2025 from BRL31.7 billion in December 2022, driven by aggressive growth strategy. Investments exceeded BRL30 billion during this period and were partly financed by used vehicle sales. Despite Fitch's expectation of gradual consolidated EBITDA and margin improvement, net debt will likely continue to rise over the next three years to finance negative FCF. Sustained debt reduction depends on Simpar's ability to reduce investments and/or sell assets. Negative FCF: Vamos's cash generation benefits from long-term contracts for part of its revenue, which provide greater visibility for cash generation. EBITDA should grow gradually and organically, with resilient margins, as the company raises fleet utilization. Fitch projects adjusted EBITDA of BRL3.7 billion (65% margin) in 2025 and BRL4.1 billion (67% margin) in 2026, with a rental fleet of around 54,000 and 57,000 assets, respectively. Gross capex and interest expenses should continue to pressure FCF, which Fitch expects to be negative around BRL1.0 billion in 2025 and 2026. Moderate-to-High Leverage: Heavy investment to expand the fleet has pressured Vamos's financial leverage. Fitch projects consolidated adjusted net debt/adjusted EBITDA to gradually decline to 3.5x over the next two years, from 3.9x in 2024, reflecting a more conservative growth strategy and improving fleet utilization rates. Capital-Intensive Sector: Vamos faces natural challenges operating in a capital-intensive sector where considerable, regular investments in fleet expansion and renewal weigh on its financial profile during periods of strong growth. The company's retail network dedicated to selling operating assets at contract end is important to its business cycle, as it mitigates the impact of investments. Nevertheless, balanced demand dynamics should continue to support adequate pricing, with profitability sufficient to preserve a healthy spread of return on invested capital (ROIC) over cost of debt. Peer Analysis Simpar's business profile is stronger than that of Localiza Rent a Car S.A. (Localiza; IDRs BB+ and National Long-Term Rating AAA(bra), all with Stable Outlook). Simpar has a scale similar to Localiza's and a more diversified portfolio of services; however, its weaker financial profile, with higher leverage and more pressured FCF, weighs on the rating. Compared with Unidas Locações e Serviços S.A. (Unidas; IDRs BB- and National Long-Term Rating AA(bra), all with Stable Outlook), Simpar has a much stronger business profile, greater liquidity, and better access to the credit market. These advantages are offset by leverage that is higher than Unidas's. Key Assumptions Fitch's Key Assumptions in Vamos's Rating Case Include: - End-of-period rental fleet growth of 4% in 2025, 6% in 2026, and 7% in 2027; - Average EBITDA margin of 85% in the rental business from 2025 to 2027; - Gross capex of BRL3.0 billion in the next three years; - Dividend payments of around 40% of net income. RATING SENSITIVITIES Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade - A downgrade of Simpar's ratings; - Deterioration of Simpar's legal, strategic and operational incentives to provide support. Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade - An upgrade of Simpar's ratings. Liquidity and Debt Structure Simpar's adequate consolidated liquidity is a key credit factor, with cash covering adjusted short-term debt by X1.1x in June 2025. However, the group will need to access new credit lines as FCF should remain negative. Vamos's liquidity is manageable and as evidenced by the company's ability to adequately manage its negative FCF and its short- and medium-term obligations, reflected in a reasonably lengthened debt amortization schedule. Vamos's cash and marketable securities/short-term adjusted debt ratio averaged above 1.5x over the past two years. As of June 2025, the company had BRL4.0 billion in cash and marketable securities and total adjusted debt of BRL17.5 billion, of which BRL2.4 billion matures by YE2026. Financial flexibility is enhanced by a committed line with BNDES of BRL850 million, out of which BRL335 million remains to be withdrawn. Vamos's debt profile consists mainly of debentures and Agribusiness Receivables Certificates (CRAs) (54%), bank loans (34%), and sale of receivables (7%). The ability to defer expansion investments to adjust to the economic cycle, and the group's considerable number of unencumbered assets—reflected in a net book value of fleet/adjusted net debt ratio of around 1.2x—also contributes to its financial flexibility. Issuer Profile Vamos is Brazil's largest lessor of heavy vehicle fleets, machinery, and equipment, and it is also a seller of used vehicles. Publicly listed on B3, it has a 36.4% free float, Simpar being the main shareholder with 61.3%. MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS Fitch's latest quarterly Global Corporates Macro and Sector Forecasts data file which aggregates key data points used in its credit analysis. Fitch's macroeconomic forecasts, commodity price assumptions, default rate forecasts, sector key performance indicators and sector-level forecasts are among the data items included. ESG Considerations The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. Entity/Debt Rating ----------- ------ Vamos Europe senior unsecured LT BB- New Rating Vamos Locacao de Caminhoes, Maquinas e Equipamentos S.A. LT IDR BB- New Rating LC LT IDR BB- New Rating ============= J A M A I C A ============= JAMAICA: BOJ Reports Net Profits of $19.6BB thru Sept. 10 --------------------------------------------------------- RJR News reports that the Bank of Jamaica (BOJ) is reporting net profits of $19.6 billion for the period January to September 10, 2025. The central bank says total assets increased from $1.1 trillion to $1.2 trillion between September 11 last year and September 10 this year, according to RJR News. It explains that the $100 billion jump was driven mainly by a spike in foreign assets, which grew to $1 trillion from $853.4 billion a year earlier, the report relays. But local assets declined over the same period, falling from $270.5 billion to $241.4 billion, the report discloses. Meanwhile, investors are demanding higher returns on deposits placed with the central bank, the report says. RJR relates that this comes as the BOJ continues to issue its 6% per annum fixed rate certificates of deposit to mop-op liquidity. Investors submitted 281 bids, valued at $36.8 billion, short of the $40 billion the BOJ wanted to withdraw from the system, the report notes. The average interest rate demanded was 6.2%, the report discloses. The lowest bid came in at $3.8 million at 5.43% while the highest was $250 million at 8%, the report adds. About Jamaica Jamaica is an island country situated in the Caribbean Sea. Jamaica is an upper-middle income country with an economy heavily dependent on tourism. Other major sectors of the Jamaican economy include agriculture, mining, manufacturing, petroleum refining, financial and insurance services. On Feb. 21, 2025, Fitch Ratings affirmed Jamaica's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB-', with a positive rating outlook. In October 2023, Moody's upgraded the Government of Jamaica's long-term issuer and senior unsecured ratings to B1 from B2, and senior unsecured shelf rating to (P)B1 from (P)B2. The outlook has been changed to positive from stable. In September 2024, S&P affirmed 'BB-/B' longterm foreign and local currency sovereign credit ratings on Jamaica and revised outlook to positive. =========== M E X I C O =========== BOWERS TRUCKING: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------------- Debtor: Bowers Trucking, Inc. d/b/a Bowers Trucking & Logistics 66417 Hwy 60 Ponca City, OK 74604 Business Description: Bowers Trucking, Inc., headquartered in Ponca City, Oklahoma, provides transportation services across ground, ocean, and air throughout the US, Canada, and Mexico, including import and export container shipments to China and Japan. Founded in the early 1960s by Glen C. Bowers to support his sawmill operations in Fairfax, Oklahoma, the Company has expanded under subsequent generations to serve large and small businesses with flatbed freight, commodities, and time-sensitive shipments. Bowers Trucking focuses on operational standards, safety, and communication. Chapter 11 Petition Date: September 18, 2025 Court: United States Bankruptcy Court Western District of Oklahoma Case No.: 25-12884 Judge: TBD Debtor's Counsel: Stephen J. Moriarty, Esq. FELLERS, SNIDER ET AL 100 N. Broadway, STE 1700 Oklahoma City, OK 73102-8820 Tel: 405-232-0621 Fax: 405-232-9659 E-mail: smoriarty@fellerssnider.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Garrett Bowers as CEO. A full-text copy of the petition, which includes a list of the Debtor's 20 largest unsecured creditors, is available for free on PacerMonitor at: https://www.pacermonitor.com/view/QJJWGYY/Bowers_Trucking_Inc__okwbke-25-12884__0001.0.pdf?mcid=tGE4TAMA ===================== P U E R T O R I C O ===================== PUERTO RICO: Trump Administration Faces Lawsuit Over Board Firings ------------------------------------------------------------------ Daniel Seiden of Bloomberg Law reports that the three members of the Federal Oversight and Management Board for Puerto Rico have taken the Trump administration to court, claiming its effort to fire them breaches federal statute and the U.S. Constitution. According to their complaint, members may only be removed for cause, but they instead received unexplained dismissal notices from the Presidential Personnel Office. The plaintiffs asked the U.S. District Court for Puerto Rico to block the terminations. The Justice Department did not provide immediate comment. About Puerto Rico Puerto Rico is a self-governing commonwealth in association with the United States. The chief of state is the President of the United States of America. The head of government is an elected Governor. There are two legislative chambers: the House of Representatives, 51 seats, and the Senate, 27 seats. The governor-elect is Ricardo Antonio Rossello Nevares, the son of former governor Pedro Rossello. In 2016, the U.S. Congress passed PROMESA, which, among other things, created the Financial Oversight and Management Board andimposed an automatic stay on creditor lawsuits against the government, which expired May 1, 2017. The members of the oversight board are: (i) Andrew G. Biggs, (ii) Jose B. Carrion III, (iii) Carlos M. Garcia, (iv) Arthur J. Gonzalez, (v) Jose R. Gonzalez, (vi) Ana. J. Matosantos, and (vii) David A. Skeel Jr. On May 3, 2017, the Commonwealth of Puerto Rico filed a petition for relief under Title III of the Puerto Rico Oversight, Management, and Economic Stability Act (PROMESA). The case is pending in the United States District Court for the District of Puerto Rico under case number 17-cv-01578. A copy of Puerto Rico PROMESA petition is available at http://bankrupt.com/misc/1701578-00001.pdf On May 5, 2017, the Puerto Rico Sales Tax Financing Corporation (COFINA) commenced a case under Title III of PROMESA (D.P.R. Case No. 17-01599). Joint administration has been sought for the Title III cases. On May 21, 2017, two more agencies; Employees Retirement System of the Government of the Commonwealth of Puerto Rico and Puerto Rico Highways and Transportation Authority (Case Nos. 17-01685 and 17-01686) commenced Title III cases. U.S. Chief Justice John Roberts named U.S. District Judge Laura Taylor Swain to preside over the Title III cases. The Oversight Board has hired as advisors, Proskauer Rose LLP and Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic consultant, Citigroup Global Markets as municipal investment banker, and Ernst & Young, as financial advisor. Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M. Abelson, Esq., of Proskauer Rose LLP; and Hermann D. Bauer, Esq., at O'Neill & Borges LLC are onboard as attorneys. Prime Clerk LLC is the claims and noticing agent. Prime Clerk maintains the case Web site https://cases.primeclerk.com/puertorico Jones Day is serving as counsel to certain ERS bondholders. Paul Weiss is counsel to the Ad Hoc Group of Puerto Rico General Obligation Bondholders. ********* 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. 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