In This Article:
* S&P cuts Pemex stand-alone rating to B- from BB-
* S&P cuts credit outlook to "negative" from "stable"
* Agency says Pemex needs $20 bln of support for many years
* S&P also takes action on 77 Mexican financial companies (Recasts headline, adds lowered outlook for Mexican financial institutions)
MEXICO CITY, March 4 (Reuters) - Ratings agency Standard & Poor's (S&P) on Monday slashed the credit rating for Mexico's national oil company Petroleos Mexicanos, or Pemex, piling more pressure on the government to tighten up the debt-laden oil firm's finances.
S&P followed the Pemex cut with lower credit outlooks for a range of major Mexican financial institutions and companies, including telecommunications giant America Movil and Coca-Cola Femsa, the world's largest Coke bottler.
The agency's moves highlight overall concerns with the Mexican government's debt load and spending plans that were raised when S&P lowered the government's credit outlook to negative on Friday.
S&P cut its stand-alone assessment of Pemex to 'B-' from 'BB-', reflecting growing concern that financial support pledged by the government to shore up the firm and its slowing production will not be enough.
The agency also cut Pemex's outlook to negative from stable while keeping its global investment grade rating at 'BBB+', in line with the Mexican government. The peso currency dipped as much as 0.6 percent on Monday after the S&P moves, though it rebounded to end the trading day up 0.04 percent. At 404 GMT the peso was up 0.09 percent at 19.32 to the U.S. dollar.
The bleaker outlook reflects concern that the government's plan to clean up Pemex's finances is insufficient, S&P said, adding that the company is exposed to political decisions that could conflict with its financial objectives.
"The government's financial support, in order to restore credit fundamentals, falls well short of the company's multi-annual capital investment needs," S&P said in a statement.
NEGATIVE OUTLOOK
Citing the fiscal pressures facing Mexico's government and economy, S&P later also lowered the outlook to "negative" from "stable" for America Movil, Coca-Cola Femsa, and upscale retailer Liverpool, but kept their ratings unchanged.
The lowered outlook reflects the exposure that these companies face from the government's financial vulnerabilities, describing firms in telecommunications and beverages as "moderately sensitive" to country risk.
The agency added that it would consider a one-notch downgrade for both America Movil and Coca-Cola Femsa if it were to downgrade the Mexican government.