Moody's ups Levi unsecured debt rating to Caa2

Moody's Investors Service said it upgraded Levi Strauss & Co.'s senior unsecured debt rating to Caa2 from Caa3. The outlook is positive.

Moody's also affirmed the corporate family rating at Caa1 and senior secured term loan rating at B3. The outlook has been revised to positive from stable.

Moody's said the positive actions reflect the continued progress the company has made in stabilizing sales, improving its profitability and resolving its pending tax issues with the IRS.

The ratings also recognize the further diversification of the company's distribution network resulting from the introduction of the Levi Strauss Signature brand more broadly into the mass channel internationally, the growth in sales of that product and the growth in revenues from Europe and Asia, the agency said.

More specifically, Levi's estimated $1.85 billion of senior unsecured notes due through 2015 was upgraded to Caa2 from Caa3. The company's corporate family rating of Caa1 and its $500 million guaranteed senior secured term loan facility due 2009 at B3 were affirmed.

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