S&P assigns Goodyear loans BB, B+

Standard & Poor's said it assigned various ratings to Goodyear Tire & Rubber Co.'s proposed bank financings, including a BB to the $1.5 billion asset-based revolving credit facility with a recovery rating of 1 and a B+ to the $1.2 billion second-lien term loan with a recovery ratings of 2.

At the same time, the agency said it assigned a 5 recovery rating to the existing $650 million senior secured notes.

The corporate credit rating on Goodyear is B+/positive/B-2, S&P said, adding that the ratings on the company reflect its aggressive financial risk profile, characterized by low earnings in North America, a leveraged capital structure and significant, albeit declining, underfunded employee benefit liabilities.

These factors more than offset the company's business strengths, including its position as one of the three largest global tire manufacturers, its good geographic diversity, its strong distribution and its well-recognized brand name, S&P noted.

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