Fitch Upgrades Interpool's IDR to 'BB+'; Outlook Stable.

CHICAGO -- Fitch Ratings has upgraded the following debt ratings of Interpool Inc. (IPX) and its subsidiary, Interpool Capital Trust. The Rating Outlook is Stable.

Interpool Inc.

--Long-term Issuer Default Rating (IDR) to 'BB'+ from 'BB';

--Senior unsecured debt to 'BB+ from 'BB' ';

--Senior secured credit facility to 'BBB-' from 'BB+'.

Interpool Capital Trust

--Preferred stock to 'BB-' from 'B+'.

In addition, Fitch rates the following:

Interpool Containers Limited

--Long-term IDR 'BB+'.

Ratings for Interpool, Ltd and Interpool Container Funding, SRL have been withdrawn because debt has been repaid and the entities will no longer issue debt.

The rating upgrade reflects IPX's leadership position in the chassis and intermodal container leasing segments, overall financial performance, and improved financial profile resulting from the sale of 74% of the containers in its operating lease fleet, or approximately 273,300 units for $516 million in cash. IPX recognized an after-tax gain-on-sale of $60.2 million in connection with this sale. The proceeds of the sale were used to repay $502 million of indebtedness. Consequently, the sale and subsequent repayment of debt have improved overall liquidity, significantly lowered leverage, and increased unencumbered revenue-generating assets available to support senior unsecured debt. Monetizing the container operating lease portfolio has also enhanced funding flexibility and reduced residual exposure to volatile container prices. Furthermore, management has also made significant progress toward compliance with Section 404 of the Sarbanes-Oxley Act.

Rating concerns include significant customer concentrations, limitations on, or an inability to upstream or access equity from, Interpool Ltd. due to its foreign tax status, impact of continued increases in energy prices on international trade, and the possibility of sustained economic or political instability throughout the Pacific Rim, particularly China.

Key rating drivers include IPX's ability to maintain consistent operating performance and generate sufficient cashflow throughout an economic and/or industry cycle to meet ongoing equipment replacement requirements and debt maturities, repositioning of its container business to focus on both asset ownership and asset management, increasing efficiency and flexibility in both the container and chassis segments, and resolution of remaining Sarbanes-Oxley compliance requirements.

Headquartered in Princeton, N.J., with roots dating to 1968, Interpool Inc. is the holding company for Interpool Limited (Limited), Interpool Containers Limited, and Trac Lease, Inc. (Trac Lease), and owns 50% of Container Applications International, Inc. (CAI). Interpool is publicly traded and listed on the New York Stock Exchange (symbol: IPX).

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.