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Thursday, 28 April 2011 15:41

Chrysler to Repay All Bailout Loans this Quarter

Chrysler announced April 28 that it will repay its U.S. Treasury, Canadian Federal and Ontario aid loans within a few months.

The automaker will achieve this by refinancing that debt in a new term loan facility and through a private offering of newly issued debt securities to institutional investors. The offering will be exempt from registration under the U.S. Securities Act of 1933.

Chrysler said it will use the proceeds of that offering — plus the gains from Fiat’s plans to purchase an incremental ownership interest in the automaker — to completely pay down its debt to the aforementioned U.S. and Canadian governments and take care of the related fees and expenses.

Sergio Marchionne, chief executive officer, said, “We have chosen to accelerate the pace to bring about, in the shortest possible time, the birth of a single group capable of fully leveraging the joint development of the respective international activities.
“Chrysler is undergoing an extraordinary industrial and financial turnaround, and Fiat is ready to take control, in order to bring even greater stability and strength to the relationship in the interests of both,” he added.

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