Ford Motor Co., which recently pledge its assets such as manufacturing plants to obtain up to $18 billion in financing, has announced it will put up its claim on Mazda as collateral for additional funding.
Ford Motor Co., which recently pledge its assets such as manufacturing plants to obtain up to $18 billion in financing, has announced it will put up its claim on Mazda as collateral for additional funding.
Ford roughly owns a third of Mazda in stock and other financial instruments.
Ford’s Mazda shares will be used to increase the automaker’s credit line from the origional $8 billion in credit to up to $11.5 billion. Ford states that confidence from lenders led to the increase.
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2 comments so far
It looks like doom for Ford. They seem to be gathering every cent of cash they can from secured loans but not by selling divisions.
I expect the cash will be used for more UAW buyouts and good deals for favorites. Ford can then threaten bankruptcy and force creditors to either buy off the Ford family or face years of contention and delay in courts while the assets deteriorate.
That way the Ford family will end up still very rich or very much richer.
The creditors wouldn’t have much choice. With everything mortgaged to the hilt and little cash would you want to seize Ford plants and fix the company?
Of course this is merely guessing. Who knows? I want Ford to come back and prosper. They may very well make good use of these loans.
December 11th, 2006 at 4:36 pm
K, I personally think Ford will. The family doesn’t want to see their company collapse in greed any more than you or I do (we hope) and they should be hoping Mullaly will be the meal ticket out of their sinkhole.
December 12th, 2006 at 1:57 am
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