Wednesday, July 18, 2007

Chrysler increases its loan rates for buyout

DETROIT NEWS - - Chrysler increased the interest rates on $12 billion of loans it is seeking to fund a buyout by Cerberus Capital Management LP after investors balked at the money-losing carmaker's original terms, lenders said. The company raised the yield it is willing to pay on a $10 billion term loan for its auto unit to 3.75 percentage points over the London interbank offered rate from 3.25 percentage points it was seeking on June 28. Chrysler is offering Libor plus at least 7 percentage points on a $2 billion second-lien loan, compared with the 6 percentage points initially proposed, said three investors, who declined to be named because the terms aren't public.

Honda to build a new jet engine plan

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