NEW YORK (AP) — Wall Street gave a tentative "thumbs up" yesterday to the long-awaited debt refinancing of Ingersoll-Rand Co. Ltd., which borrowed heavily to transform itself into a diversified manufacturer.

Last year the 138-year-old Bermuda-based company, which has long been a highly cyclical machinery maker, paid $10.1 billion for Piscataway, N.J.-based Trane Inc., which focuses almost exclusively on residential and commercial climate control. That acquisition culminated several years of divestitures and acquisitions that have remade the conglomerate.

When Ingersoll-Rand bought Trane it issued $1.5 billion of commercial paper and a $2.95 billion bridge loan that is set to expire this June.

Besides the deadline for paying off its debt, the global recession and collapsing demand for many of Ingersoll-Rand's products have squeezed its cash flow. Last year it lost $2.62 billion, or $8.73 per share, compared with a profit of nearly $4 billion, or $13.43 per share, the year before.

Late on Monday, the company said it will offer a mix of senior notes to raise up to $1 billion.

Ingersoll-Rand also slashed its quarterly dividend by 61.1 percent to seven cents, cut its first-quarter revenue guidance and said full-year financial results will likely be lower than it had forecast on February 11 because of the weak economy.

"The world probably has gotten worse over the last five weeks and we have been able to verify that fact with data," a company spokesman said.

In response to Ingersoll-Rand's announcement, Wall Street analysts maintained their stock ratings on what they see as the solution to a near-term challenge.

"These moves, if successful, will provide the liquidity necessary to retire the $754 million bridge loan and $548 million of (other) 2009 debt maturities," Citi Investment Research analyst Jeffrey T. Sprague said in a client note. He reiterated his "Hold" rating on the shares.

KeyBanc analyst Jeffrey D. Hammond maintained his "Buy" rating.

"We are pleased to see the financing overhang removed, albeit on more onerous terms," he said.

Sterne Agee analyst Nicholas P. Heymann said he expects "an incremental increase in Ingersoll-Rand's 2009 interest expense" because the new loans will carry a higher interest rate.

A bond analyst viewed the refinancing as mildly positive.

Standard & Poor's John R. Sico said the company is taking appropriate steps.

"We think (Ingersoll-Rand's) credit and operational initiatives enhance liquidity and financial flexibility," he said in a phone interview. "We expect the company to generate free cash flow for debt reduction and expect it to restore credit metrics within our expections of two times total leverage and funds from operations to total debt of 35 percent."