S&P rates Goodyear notes B+

Standard & Poor's said it assigned its B+ issue-level rating to the Goodyear Tire &

Rubber Co.'s proposed issuance of $750 million of senior unsecured notes due 2020.

At the same time, the agency said it assigned its recovery rating of 5.

Proceeds of this offering, together with current cash and unused availability under existing credit facilities, will be used to repay the company's outstanding balance of $325 million of 8.625% senior notes due Dec. 1, 2011 at 104.313% of the principal amount, plus accrued and unpaid interest, the agency added.

Moreover, Goodyear intends to repay about $388 million in principal amount of its 7.857% notes outstanding due Aug. 15, 2011 at a make-whole amount, plus accrued and unpaid interest, S&P said.

The rating on Goodyear reflects the company's high leverage and the substantial competition in both the replacement and original equipment tire markets, the agency said.

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