PSA Peugeot Citroen has begun syndication of a EUR1.8bn (US$2.4bn) refinancing loan, the lead banks said.

Proceeds from the new three-year loan will refinance an existing EUR2.4bn revolving credit facility signed in 2005 that matures next March, Reuters reported.

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The new loan could have two one-year extensions at the discretion of the lenders.

Peugeot said earlier this month that talks about an early repayment of around EUR1bn of the EUR3bn loan it received from the French state last year were going well. That loan is not due to be paid back until early 2011.

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