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Fitch: Grupo Sura's deal to up stake in asset management unit is credit neutral

Fitch Ratings said it views Grupo de Inversiones Suramericana SA's recently announced deal to increase its stake in unit Sura Asset Management SA to 83.58% from 78.71% as neutral to the company's credit quality.

Grupo Sura has agreed to buy additional shares in the unit from the International Finance Corp. and IFC ALAC Spain SL for $383.2 million.

Although some weakening in Grupo Sura's credit metrics is expected in the short term as the company absorbs the transaction, the rating agency expects its credit metrics to remain in line with medium-term expectations.

The acquisition is being financed by a combination of cash on hand, incremental debt and own cash flow generation, Fitch noted, adding that it expects Grupo Sura's loan-to-value metrics to remain in the 15% to 20% range on a pro forma basis post acquisition.

"Fitch views the acquisition as positive from a strategic point of view for Grupo Sura, as it consolidates its stake in the asset management business," the rating agency said. "Fitch does not expect a material deviation in key assumptions incorporated in Grupo Sura's ratings from this specific transaction."