Fiat spinning off industrial units to focus on reviving carmaking operations

Article by Christian A., on November 15, 2010

Two sources said that later this month, Fiat S.p.A.'s lenders will syndicate 4 billion euros ($5.5 billion) of loans as the carmaker prepares to spin off its industrial units.

The insiders said that Fiat is in negotiations for a 2.4 billion-euro bridge loan which will be refinanced with a bond from the unit being separated. The loan will have a one-year term that can be extended by another year.

They also said that Fiat is seeking a 1.6 billion- euro revolving credit line. Typically, loan underwriters want to reduce the amount they provide by selling, or syndicating, the debt to a wider group of lenders.

On July 21, Fiat said that the debt will be provided by Barclays Capital Plc, BNP Paribas SA, Credit Agricole CIB, Intesa Sanpaolo SpA, Societe Generale SA, Royal Bank of Scotland Group Plc, Citigroup Inc. and UniCredit SpA.

In a revolving credit, money that has been repaid can be borrowed again but in a term loan, it can’t. Fiat, which owns 20% of Chrysler Group, is spinning off industrial units to concentrate on the revival of carmaking operations.

On Oct. 21, Fiat raised 2010 forecasts after its profit in the latest quarter had surpassed analysts' estimates on sales of Iveco trucks and Case New Holland tractors.

Fiat Industrial SpA, the new company that will merge businesses including Iveco and CNH Global NV, will be listed on the Milan exchange on Jan. 3. A Fiat spokesman has declined to make a comment on the deal. [via autonews - sub. required]

Topics: fiat

If you liked the article, share on:

Comments

Recommended

British luxury automaker Aston Martin celebrates its new partnership with the Henley Royal Regatta sporting event by designing a one-off DB11 sports car that they recently revealed. The car explores...
by - June 28, 2017
The 2018 Dodge Challenger SRT Hellcat as we know, is the Demon's less powerful sibling, and there’s nothing wrong with that. But have you ever imagined how it would look...
by - June 28, 2017
Sorry Uber, but Handsome Cabs taxi company has something no one else can offer - a Lamborghini Huracan that can take their clients from Point A to Point B. This...
by - June 28, 2017
BMW saw a potential oil leak on the new M760Li, prompting them to recall the said vehicle last April. Today, a little over two months after issuing the first recall,...
by - June 28, 2017
Without a doubt, the SUV segment is getting increasingly more saturated. This month alone, we were greeted with city-oriented SUVs from the Kia Stonic to the Hyundai Kona, and now...
by - June 27, 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