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S&P: Goodyear Dunlop notes BB
Standard & Poor's said it assigned a BB rating with a 2 recovery rating to Goodyear Dunlop Tires Europe BV's proposed €250 million senior unsecured notes due 2019.
A recovery rating of 2 indicates 70% to 90% expected recovery in a default.
The agency also said it assigned a BB+ rating and a 1 recovery rating to the company's proposed €400 million European revolving credit facility due in 2016.
A recovery rating of 1 indicates 90% to 100% expected recovery in a default.
The proceeds will be used to repay any borrowings under the existing €505 million European revolving credit facility and for general corporate purposes.
The notes will be the unsecured senior obligation of Goodyear Dunlop and will rank equally with all of its existing and future unsecured senior debt and senior to any of its future subordinated debt.
The notes will be guaranteed, jointly and severally, on a senior unsecured basis by the Goodyear Tire & Rubber Co. and the U.S. and Canadian subsidiaries that are guarantors under its secured credit facilities, S&P said.
The ratings reflect its high leverage and the ongoing weakness in tire demand in both the replacement and original equipment markets, the agency said.
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