CIT Group Inc, a major lender to small and midsize businesses that has struggled under mounting losses and tight credit availability, has amended its debt restructuring offer to enlist more bondholder support.
The troubled New York-based lender had launched the restructuring effort on Oct. 1 with the hope that it will trim at least US$5.7 billion from its near-term debt.
It is also asking bondholders to approve a prepackaged reorganization plan in case it is forced to file for Chapter 11 bankruptcy protection.
The company said in a statement late on Friday that the debt exchange changes have the backing of its board and a steering committee of bondholders. Spokesman Curt Ritter declined additional comment on Saturday.
CIT Group’s losses have been mounting as its borrowing costs have outstripped its income amid the credit crunch.
It has received US$2.3 billion in federal bailout money last fall and a US$3 billion emergency loan in July from some of its largest bondholders.
Its customers range from Dunkin’ Donuts franchisees to department store operator Dillards Inc. It is also a short-term financier to about 2,000 vendors that supply merchandise to 300,000 stores, according to the National Retail Federation.
Some economists say the company’s collapse could hurt a US economy struggling to recover from recession.
CIT Group said the amended restructuring plan includes a mechanism to accelerate repayment of new notes and the shortening of maturities by six months for all new notes and junior credit facilities.
It also includes an increased amount of equity offered to subordinated debt holders and notes maturing after 2018 that had not been solicited.
The exchange offers will expire on Oct. 29, except for the additional notes maturing after 2018.
CIT had US$54.09 billion in outstanding long-term borrowings as of June 30, including US$13.85 billion due by June 30 next year.
“Over the last two weeks, we have continued to work constructively with the steering committee and believe that these amendments will further build bondholder support for our restructuring plan,” CIT Group chairman and CEO Jeffrey Peek said in the statement.
He said the company “will reduce the uncertainty around our business” through either completing the debt exchange offers or an expedited in-court restructuring.
On Tuesday, the company announced that Peek, 62, will resign at the end of the year. He has been with CIT Group since 2003.
MORE VISITORS: The Tourism Administration said that it is seeing positive prospects in its efforts to expand the tourism market in North America and Europe Taiwan has been ranked as the cheapest place in the world to travel to this year, based on a list recommended by NerdWallet. The San Francisco-based personal finance company said that Taiwan topped the list of 16 nations it chose for budget travelers because US tourists do not need visas and travelers can easily have a good meal for less than US$10. A bus ride in Taipei costs just under US$0.50, while subway rides start at US$0.60, the firm said, adding that public transportation in Taiwan is easy to navigate. The firm also called Taiwan a “food lover’s paradise,” citing inexpensive breakfast stalls
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
CROSS-STRAIT: The vast majority of Taiwanese support maintaining the ‘status quo,’ while concern is rising about Beijing’s influence operations More than eight out of 10 Taiwanese reject Beijing’s “one country, two systems” framework for cross-strait relations, according to a survey released by the Mainland Affairs Council (MAC) on Thursday. The MAC’s latest quarterly survey found that 84.4 percent of respondents opposed Beijing’s “one country, two systems” formula for handling cross-strait relations — a figure consistent with past polling. Over the past three years, opposition to the framework has remained high, ranging from a low of 83.6 percent in April 2023 to a peak of 89.6 percent in April last year. In the most recent poll, 82.5 percent also rejected China’s
PLUGGING HOLES: The amendments would bring the legislation in line with systems found in other countries such as Japan and the US, Legislator Chen Kuan-ting said Democratic Progressive Party (DPP) Legislator Chen Kuan-ting (陳冠廷) has proposed amending national security legislation amid a spate of espionage cases. Potential gaps in security vetting procedures for personnel with access to sensitive information prompted him to propose the amendments, which would introduce changes to Article 14 of the Classified National Security Information Protection Act (國家機密保護法), Chen said yesterday. The proposal, which aims to enhance interagency vetting procedures and reduce the risk of classified information leaks, would establish a comprehensive security clearance system in Taiwan, he said. The amendment would require character and loyalty checks for civil servants and intelligence personnel prior to
RSS