Fiat spinning off industrial units to focus on reviving carmaking operations

Article by Christian Andrei, 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

Login or Create new account to add a comment!

Recommended

BMW’s 550i xDrive has long been considered as one of the most successful business sedans in the world. For the brand, this may not be enough as it has officially...
by - January 20, 2017
Amazon is now moving beyond the four corners of online retailing. Only recently, the retail giant has been awarded a patent for its Road Network system. Since the patented technology...
by - January 20, 2017
The newest version of the Lamborghini Huracan is not a Superleggera, but a Performante. When Lamborghini filed for a patent for a new name, there were still debates whether this...
by - January 20, 2017
What is hotter and more menacing than a Hellcat? If we ask Dodge, its answer would be the “Demon.” Of course, we aren’t talking about a demon with horns and...
by - January 20, 2017
The 2018 model year could be an exciting year for fans and enthusiasts of the Chevrolet Corvette. This comes as the 2018 version of the Corvette is bound to feature...
by - January 19, 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