Moody's upgrades Libbey Glass

Moody's Investors Service said it upgraded Libbey Glass Inc.'s corporate family and probability-of-default ratings to B2 from Caa1, lifted its speculative-grade liquidity rating to SGL-2 from SGL-3 and assigned a final B2 (LGD3, 44%) rating to its $400 million senior secured notes due 2015.

This concludes the review for possible upgrade that began on Jan. 26, and the outlook is stable.

The rating actions follow the completion of the company's refinancing transaction and reflect Moody's expectation that Libbey Glass will sustain the recent improvements in profitability and metrics, despite the expectation for a sluggish recovery in economic conditions in 2010.

The agency said the ratings are further supported by company's leading market position in foodservice glassware, strong brand names, geographic diversification and extensive distribution capabilities.

Constraints for the rating include the company's small size relative to other rated global consumer durables companies and the capital-, labor- and energy-intensive nature of the business, Moody's said.

For 2009, the debt-to-EBITDA ratio, pro forma for the refinancing transaction, was below 6 times.

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