Friday, August 24, 2012

GM Said to Have Initial Talks With Banks to Expand Credit

General Motors Co. (GM), the largest U.S. automaker, is in early stages of talks with banks about expanding its credit line by as much as $5 billion, a person familiar with the discussions said.
GM, based in Detroit, may seek $4 billion to $5 billion in additional revolving credit from some of the lenders that provided its current line of credit, said the person, who asked not to be identified because the matter is private. GM, in an e- mail, declined to comment.
The automaker has “substantial cash requirements going forward,” including pension obligations and reinvesting in operations, according to an Aug. 3 regulatory filing. GM had $32.6 billion in cash and marketable securities on hand on June 30. It also has a $5 billion revolving credit line that was set up in October 2010, according to the filing.
“While we do not believe that we will draw on the secured revolving credit facility to fund operating activities, the facility provides additional liquidity and financing flexibility,” GM said in the filing.
The company was revamped in a government-backed bankruptcy in 2009. GM in 2011 took back the title of the world’s top seller of cars and light trucks from Toyota Motor Corp. (7203) Chief Executive Officer Dan Akerson faces a slide in GM’s share of its home market to 18 percent through July from 20 percent a year earlier. Akerson also wants to end losses in Europe that have totaled $16.8 billion since 1999.

Read more: http://www.bloomberg.com/news/2012-08-24/gm-said-to-have-initial-talks-with-banks-to-expand-credit.html

No comments: