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Moody’s assigns Ba3 to Goodyear notes
Moody's Investors Service said it assigned a Ba3 rating to the proposed $1 billion issuance of senior unsecured notes by Goodyear Tire & Rubber Co.
Net proceeds, together with current cash and cash equivalents, will be used to redeem the company's 8¼% senior notes due 2020.
On Aug. 6, Moody's raised Goodyear's corporate family rating and probability of default rating to Ba2 and Ba2-PD, respectively, and assigned a stable outlook.
Interest savings resulting from the current transaction, along with the company's ongoing improvement in segment operating income and a long-term favorable business environment for tires, are expected to solidly position the company's credit metrics in line with the Ba2 corporate family rating. For the LTM period ending Sept. 30, Goodyear's debt/EBITDA estimated 3.2 times and EBITA/interest estimated 2.9 times.
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