Moody’s ups ZF Friedrichshafen, notes

Moody's Investors Service said it upgraded ZF Friedrichshafen AG’s corporate family rating to Ba1 from Ba2 and probability of default rating to Ba1-PD from Ba2-PD.

At the same time the agency upgraded the rating of the senior unsecured notes issued by ZF North America Capital, Inc. and the rating of the senior unsecured notes issued by TRW Automotive Inc. to Ba1 from Ba2.

The outlook remains positive.

Moody’s said the action was prompted by the steady progress ZF is showing since the closing of the TRW takeover with regard to: (a) integrating the acquired business into the ZF organization; as well as (b) with regard to strengthening its overall credit quality.

During 2015 ZF generated a free cash flow of €693 million (with 7˝ months contribution from TRW), which well exceeds the minimum level of €500 million the agency expected when it assigned the rating last year.

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