Nov 27, 12:15 PM EST
>
>Ford to get $18 billion in financing=20
>
>By DAVID RUNK=20
>Associated Press Writer
>
>=20
>AP Photo/DAVID ZALUBOWSKI=20
>=20
>Business Video=20
>=20
>=20
>=20
>=20
>=20
>=20
>Advertisement
> =20
>=20
> =20
>DETROIT (AP) -- Ford Motor Co. said Monday it plans to get about $18
>billion in financing to help fund its restructuring and help make up for
>anticipated losses in its automotive operations over the next two years. >
>The No. 2 U.S. automaker also said the financing - with its domestic
>plants and other automotive assets used as collateral - will help protect
>against a recession or other unanticipated events.
>
>Analysts said it makes the possibility of Ford selling its finance arm
>less likely but could support bigger restructuring efforts.
>
>Ford said a new five-year senior secured revolving credit facility of
>about $8 billion is intended to replace Ford's existing unsecured credit
>facilities of $6.3 billion. A senior secured term loan will total about $7=
>billion, and unsecured capital market transactions will total about $3 bil= lion.
>
> =20
>=20
> =20
>The revolving credit and term loan will be secured by liens on U.S.
>manufacturing facilities, substantially all of the company's other
>domestic automotive assets, certain intellectual property, stock in
>certain subsidiaries - including Ford Motor Credit Co. and Volvo - and up
>to $4 billion in cash.
>
>Ford spokeswoman Becky Sanch said it was the first time the company had
>used assets such as plants to secure financing. Earlier this month, Ford
>had said it was near an announcement on such a deal.
>
>Ford shares fell 20 cents, or 2.4 percent, to $8.32 in Monday morning
>trading on the New York Stock Exchange.
>
>Following the transactions, Ford said it will have about $38 billion at
>year's end to fund automotive operations. That includes cash, cash
>equivalents, loaned and marketable securities and available credit facilit= ies.
>
> Latest News=20
>Ford to get $18 billion in financing
>SEC asks Ford about Syria, Sudan
>
>GM raises Russian sales forecast for '06
>
>Kerkorian seeks to boost MGM stake
>
>GM aims to grab 10 pct. of Asian market
>
>Ford Motor Co. reduces reported losses
>
>=20
>=20
>=20
>=20
>Buy AP Photo Reprints=20
>=20
>=20
>=20
>=20
>=20
>
>=20
>=20
> =20
>"The additional liquidity should be sufficient to give Ford the ability to=
>fund itself for several years, even with considerable negative cash flow,"=
>Rod Lache, an analyst for Deutsche Bank, said in a note to investors. >
>Dearborn-based Ford lost $7 billion during the first nine months of the
>year and has said it won't return to profitability until 2009.
>
>The company has offered buyouts and early retirement packages to all
>75,000 U.S. production workers and plans to shutter 16 plants to reduce
>manufacturing capacity to match lower demand for its products as part of
>its "Way Forward" restructuring plan.
>
>Some Wall Street analysts have questioned why the sale of part of Ford
>Motor Credit wasn't part of its restructuring update announced in
>September. Ford has said it didn't plan to sell its finance arm.
>
>At least two analysts said Monday that using assets such as Ford Motor
>Credit to back the secured loans makes it less likely that Ford will sell
>the credit arm.
>
>Ford expects the transactions to close before Dec. 31. The senior secured
>credit facilities will be arranged by Citigroup Corporate and Investment
>Banking, Goldman Sachs Credit Partners L.P. and J.P. Morgan Securities Inc=