Ford to raise $3 billion in equity, will extend credit

FoMoCo announced today that it would pay back and extend by two years $10.7 billion of secured debut and issue some $3 billion of stock and equity linked to securities to improve its balance sheet. The Dearborn automaker said that it would pay down $2.5 billion of its secured debut due in December 2011 and extend the remainder by two years.

Ford, which reported a surprise profit for the third quarter of nearly $1 billion, has borrowed more than $23 billion in late 2006 to finance its restructuring efforts. The automaker said that it has commitments from lenders to extend $6 billion of the remaining $8 billion of debt from the secured revolver.

It said it would offer $2 billion of senior convertible notes due in 2016 . Ford also said that it would start an equity distribution program to issue $1 billion of common stock over a period of time before December.

– By: Stephen Calogera

Source: Reuters