The Car and Truck Fleet and Leasing Management Magazine

Chrysler's $5B Debt Refinancing to Save $390M

February 5, 2014

Fiat Chrysler will raise nearly $5 billion in private bond financing and loans to pay off the UAW trust and close out the merger, a move expected to save the automaker $390 million by 2016.

The Chrysler Group has priced several secured senior notes and will also secure several term loan facilities by Feb. 7 as part of the financing deal. Chryler, which has been merged into the FCA group, has priced $1.375 billion in senior debt due in 2019 to yield 6.165 percent and a $1.38 billion 2021 senior bond to yield 6.433 percent, according to a Chrysler release.

Chrysler also plans to increase an existing loan by $250 million and add a new $1.75 billion secured loan facility.

Under the deal, Chrysler would likely save about $130 million per year for three years by closing out a $4.587 million loan from the VEBA Trust signed on June 10, 2009, according to a presentation of Fiat's fourth-quarter results.

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