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Ford to cut debt by nearly $10 billion

Posted Monday, Apr 6, 2009, 1:48 pm in Employee News

Ford Motor Co. said today that it expects to shed about 38 percent of its automotive debt, allowing the company to slash its annual interest payments by more than $500 million and improving the company’s chance to survive without resorting to federal loans, the Detroit Free Press reported.

The debt reduction is the result of three separate offers Ford announced on March 3 that gave investors an opportunity to accept payments at less than the face value of bonds and loans, the Free Press said. The holders of $9.9 billion in debt accepted those offers, the paper reported.

The Free Press said the transactions will allow Ford to reduce its automotive debt from $25.8 billion to $15.9 billion. The acceptance period for two of the three offers closed on Friday and a loan repurchase offer expired last month, the paper said.
 
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