Moody's lifts Cooper Tire outlook to positive

Moody's Investors Service said it revised Cooper Tire & Rubber Co.'s outlook to positive from stable and affirmed the company's B2 corporate family and probability-of-default ratings, B2 (LGD4, 56%) senior unsecured notes and SGL-2 speculative grade liquidity rating.

The outlook change follows favorable developments in restoring the company's financial performance, a modest improvement in North American replacement tire demand and prospects that these trends could continue, the agency said. In addition, Cooper Tire has announced an agreement to divest a non-core business and plans to monetize its investment in Kumho Tire in early 2008. Proceeds from the latter actions, combined with existing cash and temporary investments, should allow the company to retire up to $200 million of its senior unsecured notes.

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