Published:  12:38 AM, 13 September 2019

Mexico's $5 bn debt bailout for Pemex 'a one off'

Mexico's $5 bn debt bailout for Pemex 'a one off' Mexico's Undersecretary of Finance and Public Credit Gabriel Yorio speaks during an interview with Reuters in Mexico City, Mexic, Wednesday. -Reuters

Mexico's $5 billion rescue package to pay down debt at Pemex is a one-of-a-kind transaction that should give the struggling state oil company breathing space to focus on output and costs, Deputy Finance Minister Gabriel Yorio said.

Yorio told Reuters in an interview on Wednesday that the transaction, which also includes a debt refinancing plan, would be the last support the government gives to the world's most indebted oil company this year.

The step, announced earlier on Wednesday, was the latest by President Andres Manuel Lopez Obrador to plot a brighter future for the cash-strapped, debt-laden oil and gas producer after years of declining output.

Saddled with more than $104 billion of financial debt, Pemex suffered a downgrade to speculative grade, or "junk", earlier this year by ratings agency Fitch. Moody's warns it too could strip Mexico's largest company of its investment grade rating.

-Reuters, Mexico City

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