Lender, Trying to Stave Off Bankruptcy, Seeks to Restructure Debt; Some of Board Would Be Replaced.
NEW YORK
NEW YORK
CIT Group Inc. is in talks to borrow $4 billion to $6 billion that could be used as secured funds if its restructuring plan succeeds, or used as financing to see the company through a bankruptcy reorganization if it fails, according to two people familiar with the matter.
The lender is in 11th-hour negotiations to cut its more-than-$30 billion debt load or postpone debt maturities.
The same six bondholders that provided CIT with $3 billion in rescue financing over the summer -- including Centerbridge Partners, Allianz SE's Pacific Investment Management Co., Oaktree Capital Management and Silver Point Capital -- are likely to provide the new facility, along with some banks, the people said.
The loan could be used as a debtor-in-possession financing, which would be used to fund CIT's operations if it is forced filed for bankruptcy protection, the people said. Alternatively, if the exchange offer succeeds, the money would make sure the company has enough cash to operate and could also refinance some secured debt.
CIT hasn't finalized the new loan and banks haven't been chosen, the people said.
The lender is in 11th-hour negotiations to cut its more-than-$30 billion debt load or postpone debt maturities.
The same six bondholders that provided CIT with $3 billion in rescue financing over the summer -- including Centerbridge Partners, Allianz SE's Pacific Investment Management Co., Oaktree Capital Management and Silver Point Capital -- are likely to provide the new facility, along with some banks, the people said.
The loan could be used as a debtor-in-possession financing, which would be used to fund CIT's operations if it is forced filed for bankruptcy protection, the people said. Alternatively, if the exchange offer succeeds, the money would make sure the company has enough cash to operate and could also refinance some secured debt.
CIT hasn't finalized the new loan and banks haven't been chosen, the people said.
