From Wire Reports
Posted: Feb. 25, 2005, 9 a.m., EST
Standard & Poor’s has downgraded its credit rating on the Cooper Tire & Rubber Co. to one level above junk status but with a “stable” outlook.
The tiremaker’s “increased debt leverage and more aggressive financial policy” after the sale of its auto parts business along with weaker performance in its tire group and uncertainty in Asia factored into the downgrade, S&P analyst Martin King was reported as stating.
S&P now rates the company’s debt at investment-grade BBB-. The ratings firm also removed Cooper from CreditWatch and put its ratings outlook at “stable.” S&P expects Cooper to improve its manufacturing productivity, product mix and fill rates in the near term, according to King.
In afternoon trading, the tire company’s stock was at $18.54, down 25 cents, or 1.3 percent. Last week, Cooper shares dropped about 13 percent after the company announced fourth-quarter profit due to the sale of Cooper-Standard but also predicted that market conditions would be difficult at the start of 2005.
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