Fitch lifts Eaton to stable

Fitch Ratings said it affirmed the BBB+ issuer default ratings of Eaton Corp. plc and its indirect subsidiary, Eaton Corp.

The outlook was revised to stable from negative.

The ratings affirmed also include Eaton Corp. plc's senior unsecured bank credit facilities at BBB+, short-term issuer default rating at F2 and commercial-paper rating at F2.

Eaton Corp.'s senior unsecured bank credit facilities also were affirmed at BBB+, senior unsecured debt at BBB+, short-term issuer default rating at F2 and commercial0-paper at F2.

Also affirmed includes Cooper U.S., Inc.'s issuer default rating at BBB+ and senior unsecured debt at BBB+.

The outlook is stable.

The outlook revision reflects the company's progress toward reducing high leverage that resulted from the $13 billion acquisition of Cooper in November 2012, which was partly funded by debt, Fitch said.

In addition, execution risks surrounding the integration of Cooper and the realization of cost synergies have diminished, the agency said.

Eaton reduced debt by more than $1 billion during the first half of 2013, which contributed to a reduction in its debt-to-EBITDA ratio to 3.8x at June 30 compared to 5.1x at the end of 2012, Fitch said.

Rating strengths include the company's solid market positions in electrical and industrial markets and its product and geographic diversification, the agency said.

Rating concerns include the risk of a significant economic downturn, which could have a material negative impact on Eaton's credit profile while leverage is high, Fitch said.

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