Auburn Hills, Michigan – Chrysler has repaid US$7.6 billion in outstanding U.S. and Canadian government loans following the completion of new refinancing. The original loans, plus accrued interest and additional consideration, have been paid more than six years ahead of schedule, the company said.
The company paid $5.9 billion to the U.S. Treasury and $1.7 billion to Export Development Canada (EDC) to retire the loans granted when the Chrysler Group began operations in June 2009. EDC is the holding company through which the Canadian and Ontario governments extended loans to the automaker. Chrysler borrowed $5.1 from the U.S. government and $1.6 billion from Canadian governments.
“Less than two years ago, we made a commitment to repay the U.S. and Canadian taxpayers in full and today we made good on that promise,” said Sergio Marchionne, CEO of Chrysler Group. “The loans gave us a rare second chance to demonstrate what the people of this company can deliver and we owe a debt of gratitude to those whose intervention allowed Chrysler Group to reestablish itself as a strong and viable carmaker.”
The company’s new financing transactions consist of a term loan totalling $3.0 billion, debt securities totalling $3.2 billion, and a revolving credit facility of $1.3 billion. The new financing will save Chrysler an estimated $350 million per year in interest expenses. The company has more than $10 billion in liquidity after the refinancing and loan payoffs, including the undrawn revolving credit facility.