Navistar will take out a five-year unsecured loan for $US1.3bn to repay a $1.5bn loan that expires in March 2009. The new loan expires January 2012.
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The loan will be provided by JP Morgan Chase Bank and a group of lenders that includes Credit Suisse, Banc of America Securities and Citigroup Global Markets.
The loan can be seen as a highly positive step for Navistar, a company that has not been able to produce financial reports since September 2005, because of accounting problems. According to Bloomberg, Navistar is examining accounting for warranties and product development programmes at suppliers. The New York Stock Exchange has threatened to spend the company’s stock if the company fails to report financial results soon.
“We are very pleased with the ongoing support of our lenders and relationship banks,” said Navistar executive vice president and chief financial officer Bill Caton. “This new lending commitment is a real vote of confidence in the company. The new loan facilities will enhance our liquidity and provide additional stability in our overall capital structure at a lower cost.”
