AKRON (Jan. 3) — Standard & Poor'´s Rating Services affirmed its B+ rating on Goodyear but removed the tire maker from CreditWatch following the ratification of a new labor contract and striking employees returning to work.
S&P had put Goodyear on CreditWatch with negative implications in October after the United Steelworkers called a strike at 16 North American facilities. The union approved a new pact in late December and began returning to work Jan. 2.
Goodyear´s total debt — including $1 billion of new debt sold during the strike, operating leases and underfunded employee benefit liabilities — of about $12 billion, S&P said.
"The new contract should enable Goodyear to achieve substantial cost savings over the three-year contract term," S&P said in a statement.
Goodyear previously said it expects to save $70 million in 2007, $240 million in 2008 and $300 million in 2009.
Goodyear´s stock price also has benefited from the end of the strike. The stock rose 4.9 percent to $20.99 on Dec. 29, when the union said its membership ratified the contract.