Daimler Said to Sign 7 Billion-Euro Credit to Refinance Debt
Daimler AG, the world’s second- biggest luxury carmaker, signed a 7 billion-euro ($9.8 billion) credit line to refinance existing debt, according to two people familiar with the deal.
Daimler offered lenders initial interest of 60 basis points more than benchmark lending rates for the five-year revolving credit, according to data compiled by Bloomberg. That compares with an 160 basis-point margin for money drawn under a credit line it agreed last year, Bloomberg data show.
The Stuttgart, Germany-based company last week raised its full-year profit forecast after third-quarter net income surged to 1.53 billion euros from 41 million euros a year earlier.
The owner of the Mercedes and Maybach nameplates offered lenders a 15 basis-point fee if it uses more than one-third of the credit line, and 30 basis points if it uses more than two- thirds, according to Bloomberg data. The facility also pays a commitment fee equivalent to 35 percent of the interest margin, which will move depending on Daimler’s credit rating, the data show. A basis point is 0.01 percentage point.
A Daimler spokesman declined to comment during a public holiday in parts of Germany. Deutsche Bank AG, Societe Generale SA and UniCredit SpA are coordinators of the refinancing, Bloomberg data show.
The automaker has about $9 billion of credit lines expiring next year, according to the company’s earnings report.
Standard & Poor’s and Fitch Ratings rank Daimler’s debt BBB+, the third-lowest investment grade. Moody’s Investors Service rates it a level higher at A3
To contact the reporter on this story: Patricia Kuo in London at pkuo2@bloomberg.net
To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net
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