S&P ups Oshkosh

Standard & Poor's said it raised Oshkosh Corp.'s corporate credit rating to BB from BB- and the issue-level rating on the company's senior secured debt to BBB- from BB+ with a recovery rating of 1, indicating the expectation of very high (90%-100%) recovery in a payment default scenario.

S&P also raised the company's unsecured debt to BB from BB- with a recovery rating of 4, indicating the expectation of average (30%-50%) recovery in a payment default scenario.

The outlook is stable.

The rating actions reflect the continued expectation that Oshkosh's industrial businesses will improve in 2011 from very low activity levels, partially offsetting reduced sales and profitability at its defense segment, the agency said.

The ratings reflect Oshkosh's significant financial risk profile, which more than offsets its satisfactory business risk profile, the agency added.

The business risk profile is marked by leading positions in key segments of the cyclical specialty vehicle market, as well as good product and end-market diversity, S&P said.

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