The Germany-based automotive component and industrial bearings manufacturing group Schaeffler announced that it will use the proceeds of its equity transaction for early redemption of outstanding debt. We expect credit ratios will further improve in 2016. We are therefore raising our long-term corporate credit ratings on Schaeffler to 'BB' and the issue ratings to 'BB' and 'B+'. The stable outlook reflects our opinion that the group will maintain credit ratios commensurate with our 'BB' rating, on the back of strong operating performance in 2016-2017 and mid-single-digit revenue growth in 2016. On April 28, 2016, Standard&Poor's Ratings Services raised to 'BB' from 'BB-' its long-term corporate credit ratings on Schaeffler AG, Schaeffler Verwaltung Zwei GmbH, and Schaeffler Holding Finance
