Welcome!

News Feed Item

Chrysler Group LLC Completes $5 Billion Debt Offering and Repays VEBA Trust Note in Full

AUBURN HILLS, Mich., Feb. 10, 2014 /PRNewswire/ -- Chrysler Group LLC ("Chrysler Group") announced today the closing of its previously announced offering of secured senior debt securities, raising approximately $3.0 billion in net proceeds; and senior secured term loan facilities, raising approximately $2.0 billion in net proceeds. Chrysler Group applied the proceeds of the debt offering to prepay all amounts outstanding, including accrued and unpaid interest, of approximately $5.0 billion under the senior unsecured note issued on June 10, 2009 to the VEBA Trust with an original face amount of $4.587 billion (the "VEBA Trust Note").

The secured senior debt securities consist of $1.375 billion aggregate principal amount of 8% Secured Senior Notes due 2019 (the "2019 Notes") at an issue price of 108.25% of their aggregate principal amount plus accrued interest from December 15, 2013, and $1.380 billion aggregate principal amount of 8¼% Secured Senior Notes due 2021 (the "2021 Notes" and together with the 2019 Notes, the "Notes") at an issue price of 110.50% of their aggregate principal amount plus accrued interest from December 15, 2013. The issue prices represent a yield to maturity of 6.165% per annum for the 2019 Notes and 6.433% per annum for the 2021 Notes. 

The Notes were issued as additional 8% Secured Senior Notes due 2019 and additional 8¼% Secured Senior Notes due 2021 under an indenture, dated May 24, 2011, pursuant to which Chrysler Group previously issued $1.5 billion aggregate principal amount of 8% Secured Senior Notes due 2019 and $1.7 billion aggregate principal amount of 8¼% Secured Senior Notes due 2021.

In connection with the term loan facilities, Chrysler Group borrowed (1) an additional $250 million of term loans under its existing senior secured credit facilities maturing May 24, 2017, under which Chrysler Group borrows at 2.75% over LIBOR, subject to a LIBOR floor of 0.75%; and (2) $1.75 billion of term loans under a new senior secured term loan facility maturing December 31, 2018, at 2.50% over LIBOR, subject to a LIBOR floor of 0.75%. 

The refinancing transactions are expected to result in yearly interest expense savings, for the period from 2014 to 2016, of approximately $200 million[1] including the elimination of the non-cash VEBA Trust Note discount amortization of approximately $65 million per annum. Chrysler Group expects to record a non-cash charge of approximately $500 million in connection with the repayment of the VEBA Trust Note.  Chrysler Group consolidated financial statements are prepared in accordance with US GAAP.

"This transaction brings to a successful and earlier than anticipated conclusion the process that led the U.S. and Canadian governments, the UAW and the VEBA, together with Fiat, to take on the task of reestablishing Chrysler as a viable automotive enterprise.  With the full early repayment of government loans in 2011, the acquisition from the VEBA of their Chrysler equity stake by Fiat in January of this year, and the full monetization of the VEBA note some nine years before the expiry of its term, Fiat and Chrysler together have satisfied all the monetary commitments that were made to Chrysler back in 2009.  None remain outstanding.  All this is simply a testament to the hard work by the people of Chrysler Group in the last five years and sets the stage for the next chapter as we work to strengthen our global presence as part of Fiat Chrysler Automobiles," said Chrysler Group LLC Chairman and CEO Sergio Marchionne.

Chrysler Group placed the Notes in a private placement under Rule 144A and Regulation S under the Securities Act of 1933, as amended (the "Securities Act"). The Notes have not been registered under the Securities Act or the securities laws of any other jurisdiction and may not be offered or sold in the United States without registration or an applicable exemption from registration requirements of the Securities Act and applicable state laws.

_________________________

1 For the purposes of Fiat Group consolidated financial statements (prepared in accordance with IFRS), the refinancing transactions are expected to result in yearly interest expense savings, for the period from 2014 to 2016, of approximately $134 million. Fiat Group does not expect to record non-cash charges in connection with Chrysler Group's repayment of the VEBA Trust Note, which has been carried at face value as a result of the purchase accounting related to the acquisition of control and consolidation of Chrysler Group in May 2011.

 

SOURCE Chrysler Group LLC

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
DX World EXPO, LLC, a Lighthouse Point, Florida-based startup trade show producer and the creator of "DXWorldEXPO® - Digital Transformation Conference & Expo" has announced its executive management team. The team is headed by Levent Selamoglu, who has been named CEO. "Now is the time for a truly global DX event, to bring together the leading minds from the technology world in a conversation about Digital Transformation," he said in making the announcement.
"Space Monkey by Vivent Smart Home is a product that is a distributed cloud-based edge storage network. Vivent Smart Home, our parent company, is a smart home provider that places a lot of hard drives across homes in North America," explained JT Olds, Director of Engineering, and Brandon Crowfeather, Product Manager, at Vivint Smart Home, in this SYS-CON.tv interview at @ThingsExpo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
SYS-CON Events announced today that Conference Guru has been named “Media Sponsor” of the 22nd International Cloud Expo, which will take place on June 5-7, 2018, at the Javits Center in New York, NY. A valuable conference experience generates new contacts, sales leads, potential strategic partners and potential investors; helps gather competitive intelligence and even provides inspiration for new products and services. Conference Guru works with conference organizers to pass great deals to gre...
DevOps is under attack because developers don’t want to mess with infrastructure. They will happily own their code into production, but want to use platforms instead of raw automation. That’s changing the landscape that we understand as DevOps with both architecture concepts (CloudNative) and process redefinition (SRE). Rob Hirschfeld’s recent work in Kubernetes operations has led to the conclusion that containers and related platforms have changed the way we should be thinking about DevOps and...
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform. In his session at @ThingsExpo, Craig Sproule, CEO of Metavine, demonstrated how to move beyond today's coding paradigm and shared the must-have mindsets for removing complexity from the develop...
In his Opening Keynote at 21st Cloud Expo, John Considine, General Manager of IBM Cloud Infrastructure, led attendees through the exciting evolution of the cloud. He looked at this major disruption from the perspective of technology, business models, and what this means for enterprises of all sizes. John Considine is General Manager of Cloud Infrastructure Services at IBM. In that role he is responsible for leading IBM’s public cloud infrastructure including strategy, development, and offering m...
The next XaaS is CICDaaS. Why? Because CICD saves developers a huge amount of time. CD is an especially great option for projects that require multiple and frequent contributions to be integrated. But… securing CICD best practices is an emerging, essential, yet little understood practice for DevOps teams and their Cloud Service Providers. The only way to get CICD to work in a highly secure environment takes collaboration, patience and persistence. Building CICD in the cloud requires rigorous ar...
Companies are harnessing data in ways we once associated with science fiction. Analysts have access to a plethora of visualization and reporting tools, but considering the vast amount of data businesses collect and limitations of CPUs, end users are forced to design their structures and systems with limitations. Until now. As the cloud toolkit to analyze data has evolved, GPUs have stepped in to massively parallel SQL, visualization and machine learning.
"Evatronix provides design services to companies that need to integrate the IoT technology in their products but they don't necessarily have the expertise, knowledge and design team to do so," explained Adam Morawiec, VP of Business Development at Evatronix, in this SYS-CON.tv interview at @ThingsExpo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
To get the most out of their data, successful companies are not focusing on queries and data lakes, they are actively integrating analytics into their operations with a data-first application development approach. Real-time adjustments to improve revenues, reduce costs, or mitigate risk rely on applications that minimize latency on a variety of data sources. In his session at @BigDataExpo, Jack Norris, Senior Vice President, Data and Applications at MapR Technologies, reviewed best practices to ...
Widespread fragmentation is stalling the growth of the IIoT and making it difficult for partners to work together. The number of software platforms, apps, hardware and connectivity standards is creating paralysis among businesses that are afraid of being locked into a solution. EdgeX Foundry is unifying the community around a common IoT edge framework and an ecosystem of interoperable components.
"ZeroStack is a startup in Silicon Valley. We're solving a very interesting problem around bringing public cloud convenience with private cloud control for enterprises and mid-size companies," explained Kamesh Pemmaraju, VP of Product Management at ZeroStack, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
Large industrial manufacturing organizations are adopting the agile principles of cloud software companies. The industrial manufacturing development process has not scaled over time. Now that design CAD teams are geographically distributed, centralizing their work is key. With large multi-gigabyte projects, outdated tools have stifled industrial team agility, time-to-market milestones, and impacted P&L stakeholders.
"Akvelon is a software development company and we also provide consultancy services to folks who are looking to scale or accelerate their engineering roadmaps," explained Jeremiah Mothersell, Marketing Manager at Akvelon, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
Enterprises are adopting Kubernetes to accelerate the development and the delivery of cloud-native applications. However, sharing a Kubernetes cluster between members of the same team can be challenging. And, sharing clusters across multiple teams is even harder. Kubernetes offers several constructs to help implement segmentation and isolation. However, these primitives can be complex to understand and apply. As a result, it’s becoming common for enterprises to end up with several clusters. Thi...