Ford Motor Co selling stock to pay debt

[OhioChick]

Source: Times of India

4 Oct 2008, 0139 hrs IST,AFP

DETROIT: Ford Motor Co said on Friday that it is selling 500 million dollars in stock to retire short-term debt owed by Ford Motor Credit.


"It's a debt for equity swap," Ford spokesman Bill Collins said.

"We're issuing new shares. We're going to take the proceeds and use them to retire some short-term debt for Ford Motor Credit."

The transaction will reduce the company's outstanding debt which "strengthens our consolidated balance sheet."

"We also did this back in August when Goldman Sachs sold 500 million dollars in equity that was used to retire short term debt."

Ford Motor Credit Company LLC, which offers loans to consumers and dealers, is a wholly-owned subsidiary of the Ford Motor Co.

Ford Credit lost 1.43 billion dollars in the second quarter, mostly because of writedowns of unprofitable truck leases. Ford Motor had a record 8.7 billion dollar second-quarter loss after balance sheet adjustments that included asset writedowns.

Both Ford Motor Co. and Ford Credit have had their credit rating reduced twice in recent months as car sales have plummeted.


Read more: http://timesofindia.indiatimes.com/Ford_Motor_Co_selling_500mn_dollars_in_stock_to_pay_debt/articleshow/3557967.cms

[JuniperLea]

1. This is the direction of the tide...

Unless "we" want to bail every business out, there will be many failures within the next six months.

Several banks are on the watch list, even after the bailout was announced ( perhaps getting dibs on the booty? ) and I'm hearing there are many retailers on the verge as well.

It ain't over. Not by a long shot.

[OhioChick]

2. I'm afraid you're right.

This bailout was like a band-aid on a flesh wound.

[JuniperLea]

3. It's going to be an interesting 30 days or so...

then I predict a lot of anger will set in when we see more failures... retail, banks, everywhere.

[Skink]

4. Retailers should hold on until Febuary then only the strong survive.

[JuniperLea]

5. I know of a couple who are close to filing BK

And others who are going to post their after Christmas sales prices BEFORE Christmas in an effort to move stock to up cashflow.

I work in PR... we do bankruptcies, bank failures, mergers and acquisitions, mainly. I wish I wasn't bound by a non-disclosure agreement... I could curl your hair;)

[glinda]

6. No sympathy from me

car companies that did not turn their products around get no sympathy from me. They may have faired better if we had a good environmentally sound product that other countries would like.

[JuniperLea]

8. Yep! Interesting how we all knew what direction we needed to go...

We all knew we needed smaller, more fuel efficient cars, and cars that run on alternative fuels. Funny how dumb ol' us knew that, but the smart ol' auto industry couldn't have anticipated.

I'm keeping my eye on the Tesla;)

http://www.teslamotors.com/

[ingac70]

9. Ford makes plenty of little cars...

in Europe that get great gas mileage. Too bad they won't build them here.

[AndyTiedye]

11. If Ford Had Put the Escape Hybrid Power Plant into Some CARS

they could have had something pretty comparable to the Prius.

[ingac70]

12. Like I said...

Europe gets all the cars with good gas mileage

and new technology...


http://www.autobloggreen.com/2008/05/28/spy-shots-2009-ford-ka-to-include-mild-hybrid-get-60-3mpg/

[OhioChick]

7. I believe we're on the verge of

A perfect storm.

[Aristus]

10. They're eating the seed-corn.

That's the beginning of the end...