Chrysler plans to repay U.S. and Canadian government loans next week

Article by Christian A., on May 19, 2011

Chrysler intends to repay the debt it owe to the Canadian and U.S. and Canadian governments on May 24, allowing Fiat S.p.A. to increase its ownership in Chrysler by 16 percent, two people who are familiar with the scenario said.

The company has been marketing as much as $7.5 billion of debt in order to repay the U.S. and Canadian governments for loans that were obtained as part of its bankruptcy restructuring in 2009.

Last month, the company has announced that it will repay the loans to give way for Fiat to exercise an option to raise its share from 30 percent to 46.

According to one of the people familiar with the case but asked for anonymity due to the confidentiality of the matter, the new debt is expected to price Friday, and three business days are scheduled to finalize the details before the money switches hands.

Chrysler spokeswoman Eileen Wunderlich declined to comment. Insiders have previously disclosed that Chrysler is seeking a $2.5 billion term loan, a $3.5 billion bond offering and a $1.5 billion line of credit.

Italy-based Fiat will start negotiations with banks to increase its credit line to as high as 1.5 billion euros ($2.14 billion) after raising its share in Chrysler, according to three people familiar with the situation.

The company said that it will be paying $1.27 billion to acquire the 16 percent more in Chrysler. Sergio Marchionne, CEO of both Fiat and Chrysler, stated he wants to increase Fiat's share in Chrysler to 51 percent this 2011 in preparation of bringing the U.S. company to public.

If you liked the article, share on:

Comments

Recommended

All-new BMW X3 (G01) just made its debut! The updated model has a familiar design, and slightly increased dimensions compared to its successful predecessors. For more cabin space, the wheelbase...
by - June 27, 2017
Polestar is notably known to be Volvo's internal performance specialists, and around last year Polestar revealed to the public that it will utilize electrification to further advance the power of...
by - June 26, 2017
Earlier this month, Porsche introduced to us the 911 Turbo S Exclusive Series. The car wore a Golden Yellow Metallic paint. The same time it was launched, the company said...
by - June 26, 2017
Last month, the Lamborghini Centenario made its way to the Transformers: The Last Knight premiere where it got the attention of many. Following that event, three Lamborghini Centenario coupes landed...
by - June 26, 2017
The Holy Trinity of hypercars may not be accessible anymore after being discontinued, but that doesn’t mean we won’t see any more hypercars in the future. What we know is...
by - June 26, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries