NEW YORK-Chrysler Group LLC detailed terms and conditions on Thursday, the high cost to repay Government loans a bond offering and term loans and put the U.S. based automaker on firmer financial ground to be used.
The company expects to refinance loans to the Government, on 24, the company confirmed in a press release.
All in all Chrysler $7.5 billion in new loans raised: $3.2 billion in bonds, $3 billion in a term loan and credit revolving a 1.3 billion dollar facility, said the company.
The bonds and the term loans, which total Fiat SpA from $ 6.2 billion and $1.3 billion in cash from Italian automaker repay $7.5 billion in government loan restructuring used is from Chrysler's bankruptcy in 2009.
Credit facility revolvierende $1.3 billion in Chrysler used for general corporate purposes and remains undrawn credit lines.
A sharp drop in car sales pushed the Auburn Hills, Michigan-based company to the brink of collapse in 2009 before his rescue. Under the direction of Fiat almost two years ago was created before the bankruptcy.
But the loans from the United States and Canada carry high interest rates, the Chrysler costs more than $1.2 billion last year, or more than 3 million USD per day. Chrysler declined to specify how much of the funding would save the company.
Chrysler is output from the in two parts: an eight year tranche amounting to $1.5 billion and a 10-year tranche amounting to $1.7 billion. The first part bears an interest rate of 8 per cent, while the 10-year bond has an interest rate of 8.25%.
The term of loan facility Chrysler Fund to 4.75 percentage points above the London interbank offered rate, subject to can lend the floor LIBOR rate of 1.25%.
This was the second time this week the U.S. based automaker the structure of refinancing package changed. Early Chrysler term loans and bonds of 2.5 billion was looking for a 3.5 billion USD $.
But investor concerns about its financial Outlook Chrysler the cut earlier this week to US$ 2.5 billion and boost the bond offers its term loan to $3.5 billion required.
Revised include Chrysler also the term loans to more bond-like properties. People familiar with the transaction said this week, that Chrysler's revised term loan was oversubscribed.
On Thursday morning, the deal had again changed structure. The term of loans grew to $3 billion, the bond offer was reduced by $3.2 billion and the revolver was cut $ 1.5 billion to $1.3 billion.
The U.S. based automaker will help refinance to reduce interest costs of an initial public offering that could come this year. Repayment of debts can Fiat, its stake in Chrysler increase to 46 percent from the current 30 percent.
Sergio Marchionne, Chief Executive of Fiat and Chrysler, has said that its aim is in this year, Fiat increase to 51 per cent stake in Chrysler.
A concern about Chrysler said it tends strongly to gas-guzzling pickup trucks, SUVs and minivans Wilmer Stith, Portfolio Manager at MTB investment advisors, expanded.
But he added: "you're going that marry with Fiat, which has many good small cars, and I think merging the two will be a good thing."
(Reporting by Michelle Sierra and Soyoung Kim;) Writing and additional reporting by Deepa Seetharaman; Editing by Lisa von Ahn, Gerald E. McCormick, Andre Grenon and Phil Berlowitz)
Copyright 2011 Thomson Reuters.
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