GM clinches $11 billion credit facility amid Opel overhaul
DETROIT (Reuters) - General Motors Co (GM.N) secured an $11 billion revolving credit facility, more than doubling its financial cushion and further strengthening the balance sheet of the largest U.S. automaker.
The additional liquidity comes as GM works to stanch losses at its Opel brand in Europe. Last week GM said it was aiming to break even in Europe by the middle of the decade.
The new credit facility replaces a $5 billion line the company secured more than two years ago in the run-up to its initial public offering in November 2010.
The $11 billion facility offers better terms as well as the ability to borrow in currencies other than the U.S. dollar, GM said in a statement on Monday.
"The new revolver provides a significant source of backup liquidity and financial flexibility, further bolstering our fortress balance sheet," Chief Financial Officer Dan Ammann said.
The deal gives GM a credit facility comparable to those of other companies close to its size, GM spokesman Dave Roman said. Ford Motor Co (F.N), the No. 2 U.S. automaker, boosted its credit facility to $9.3 billion earlier this year.
GM's new credit line consists of a $5.5 billion three-year facility and another $5.5 billion that matures in November 2017. Its earlier $5 billion facility would have matured in 2015.
GM Financial, GM's in-house finance company, can borrow under the facility.
Thirty-five banks from 14 countries participated in the facility. Ammann said this signalled the financial community's confidence in GM's financial condition.
Earlier this year, GM was seeking a credit facility of as much as $10 billion, according to people familiar with the matter.
The U.S. presidential race has repeatedly thrown GM into the spotlight, spurring debate about the effect of the company's 2009 bankruptcy restructuring.
The U.S. government poured $50 billion into GM during the financial crisis to help the one-time blue chip avoid liquidation. The U.S. Treasury nearly halved its GM stake during GM's IPO but still owns 500 million common shares.
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