Wednesday, May 18, 2011

Chrysler will issue bonds for 3.5 billion dollars

According to news sources in North America, Chrysler is about to issue a bond of $ 3.5 billion, then 1 to 2.5 billion more than expected at first. The same source also stated that this financial obligation will be divided into two tranches with maturities of 8 and 10 years. The objective of this measure is to repay the loan of 7.5 billion that the governments of Canada and the U.S.

did in 2009 to save the company from bankruptcy. Another 2.5 billion dollars could be raised through loans from other channels. The Michigan company will then also $ 1.27 billion that Fiat will pay to buy 16% of the company, the first step to hold - probably later this year - 51% of the shares.

The details of the transaction have not yet been released, starting with the price and yield for the bond should be around 8%. But the third performance of the loan, which could be between 6 and 6.5%. In any event, the company would be less costly in the current rate of interest charged to the two governments, amounting to 10.5%.

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