- Conservatives join New Hampshire rally in support of campaign finance reform
- 11 public housing residents complete job readiness training
- Youth health care enrollment event at NIU Rockford Jan. 29
- More than 50 employers at Jan. 29 job fair
- School district’s credit rating remains solid
- State Police seize LSD, cannabis, U.S. currency in I-80 arrest
- Park District names employee, team of the year
- A closer look at fracking for natural gas
- Susan Johnson, copy editor, moves on after 21 years
- Guest Column: Clean Water Act: Supporters of clean water must make their voices heard
Ford stock conversion slashes debt by $1.9 billion
By Jim Hagerty
Ford Motor Co. announced last week that the stock conversion offer it launched Oct. 26 will reduce the company’s debt by $1.9 billion.
The move will also lower Ford’s interest costs by approximately $180 million. Included in the conversion offer were $3.6 billion in note payments and net debt reductions over the first nine months of the the year. The total adds to the $12.8 billion the company has already pared from its debt load in 2010.
“These successful conversion offers represent another significant step toward our goal of reducing our automotive debt and improving our balance sheet,” said Lewis Booth, Ford executive vice president and CFO. “We had previously said that even without the conversion offers, we expected our automotive cash to be about equal to automotive debt by the end of this year, well ahead of our earlier expectations. With the conversion offers, we will be clearly net cash positive by year-end 2010.”
Ford remains the only one of the Big Three to avoid bankruptcy.
The October conversion offer allowed holders of its 4.25 percent Senior Convertible Notes due Dec. 15, 2036, and its 4.25 percent Senior Convertible Notes due Nov. 15, 2016, into common stock. The notes were issued in 2006 and 2009, respectively, with a combined principal amount of approximately $3.4 billion.
Conversion rates averaged to about 108.113 shares of Ford common stock per $1,000 amount of principal.
As of press time, Ford was one of the most active stocks on Wall Street, trading just more than its 200-day moving price of $12.6345.
From the Dec. 1-7, 2010 issue