CIT Secures $4.5 Billion Credit Facility

kailee bradstreet

• October 30 2009
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CIT Group Inc. announced Thursday, Oct. 29,  that it has secured $4.5 billion in additional financing from lenders, according to an article posted on Yahoo.com:

“CIT is trying to restructure its debt before another $800 million of obligations come due at the beginning of November. The lender to about a million small and mid-sized businesses is looking at either filing for bankruptcy, or getting its current lenders to agree to new terms on their debt.

The new facility matures in 2012, and is backed by an estimated $30 billion of assets, which are also supporting a $3 billion loan the company received over the summer.

The $4.5 billion financing is a setback for activist investor Carl Icahn, who also had been trying to lend to the company.

CIT said the proceeds will be used to refinance some of the company’s existing secured debt, which it may have to pay off as it restructures debt. The loan will allow the company to continue serving the small and medium sized companies it lends to, the company said.

The 101-year-old company is trying to restructure its liabilities by getting investors to forgive at least $5.7 billion of debt and exchange their securities for new notes before October 29. Investors held about $30 billion in unsecured debt at the end of June, and the company had about $70 billion of assets at the time.”