Chrysler gets junk-bond credit ratings
Moody's rates the automotive division at B3, six levels below investment grade, and the financial services unit was ranked two levels higher at B1. S&P ranks both units at B, or five levels less than investment grade, Bloomberg said.
The automotive division of Auburn Hills, Michigan-based Chrysler is seeking $12 billion of high-yield loans and the finance unit wants $8 billion to help fund their purchase by Cerberus Capital Management LP. Banks led by JPMorgan Chase & Co. held meetings with potential lenders on June 28 to sell the loans, according to investors who may buy the debt.
The finance unit wants a $4 billion term loan, a $2 billion revolving credit and a $2 billion second-lien loan. The second- lien loan will rank behind the $4 billion term loan and revolving credit for repayment in the event of a bankruptcy.