Michelin Credit Rating Put on CreditWatch by S&P

(Akron/Tire Review) AFX reports out of London say that Standard & Poor’s Ratings Services has placed its BBB+ long-term corporate credit rating on Groupe Michelin, citing concerns over the tyremaker’s profitability. S&P affirmed, however, Michelin’s short-term rating at A-2.

“The CreditWatch listing reflects our heightened concerns about Michelin’s ability to adequately strengthen its profitability and cash generation in a timely manner, and to reduce its financial debt, in order to achieve a financial profile and debt protection measures required for the current long-term rating,” S&P credit analyst Barbara Castellano told AFX.

Michelin said it expects to meet its 2006 earning targets despite a “further massive increase” in raw material costs.