Today, the Company made payments of $5.9 billion to the U.S. Treasury (UST) and $1.7 billion to Export Development Canada (EDC) to retire the loans granted when Chrysler Group began operations in June 2009. EDC is the holding company through which the Canadian federal and Ontario provincial governments extended loans to Chrysler Group.
The Company borrowed $5.1 billion from the UST and $1.6 billion from the Canadian governments in June 2009 ($2.6 billion from the original loan facilities was undrawn and the facilities will be canceled). In total, Chrysler Group has paid the UST $6.5 billion and the EDC $2.0 billion, including $1.8 billion in interest and additional consideration.
“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, chief executive officer, Chrysler Group LLC. “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 re-establish itself as a strong and viable carmaker.
“Paying back the loans, along with the financial community’s investment in our refinancing packages, marks another step in the Company returning as a competitive force in the global automotive industry.”
Chrysler Group confirmed the completion of new financing transactions consisting of a term loan totaling $3.0 billion, debt securities totaling $3.2 billion and a revolving credit facility of $1.3 billion. The new financing will save Chrysler Group an estimated $350 million a year in interest expenses.
Chrysler Group continues to have more than $10 billion in liquidity after the refinancing and loan payoffs, which includes the undrawn revolving credit facility.
“Everyone in the extended Chrysler Group family, from employees to union partners to dealers and suppliers, have worked tirelessly to deliver on our promises and to win back public trust in the Company and our products,” Marchionne said. “There is more work to be done as we remain focused on fulfilling the goals outlined in our 2010-2014 business plan.”