Porsche secures ten billion euro credit line
Porsche has announced it has secured a €10 billion loan believed to be to pay for its shares in Volkswagen.
The luxury carmaker is now the majority stakeholder in Volkswagen, the most successful European car manufacturer.
Porsche Automobil Holding SE, Stuttgart said in a statement that it had finalised negotiations to secure the new credit facility of €10 billion to redeem a credit of the same size. The credit framework contract allows Porsche to extend the volume to €12.5 billion in the forthcoming weeks.
‘In the wake of the extremely difficult global economic environment and the turbulences in the bond market banks needed additional assessment, thus resulting in a need for extra time. In addition to that, the new consortium includes banks that so far have not been counterparts of Porsche with respect to credit lines,’ Porsche said in a company statement.
The credit line will be guaranteed by a consortium of 15 banks including Barclays Capital, Commerzbank, LBBW, Deutsche Bank, UBS, Credit Suisse, Santander, BayernLB, BNP Paribas, Calyon, UniCredit/HVB, Helaba, Intesa, WestLB und DZ-Bank.
Agreed at market conditions are two tranches of twelve month with the right of extending a tranche of €6.7 billion for an additional year. Porsche intends to pay down the smaller tranche fast and aims for credit ratings the results of which should be available in May 2009.
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