CIT Group Inc., a 101-year-old commercial lender, filed for bankruptcy with financing from investor Carl Icahn after the credit crunch dried up its funding and a U.S. bailout and debt exchange offer failed.
New York-based CIT listed $71 billion in assets and $64.9 billion in debt in a Chapter 11 filing in U.S. Bankruptcy Court for the Southern District of New York. None of its operating subsidiaries, including CIT Bank, a Utah-based bank, were included in the filing, and operations will proceed as normal, CIT said in a statement.
The bankruptcy “will allow CIT to continue to provide funding to our small business and middle-market customers,” said Chief Executive Officer Jeffrey Peek in a statement.
CIT has $1 billion from Icahn to fund operations while it reorganizes. The credit line, to be drawn on until Dec. 31, will be a so-called debtor-in-possession loan.
The company had asked bondholders to exchange $30 billion in debt for new securities and equity. Icahn made a competing offer. After CIT’s offer expired at midnight on Oct. 29, the company said it was tallying 150,000 ballots.
The company’s debt holders had rejected the exchange offer, with 90 percent of holders who voted opting for the prepackaged bankruptcy plan. The plan will cut $10 billion in debt, and CIT seeks “quick confirmation” of its plan, CIT Group said in a statement.
CIT said it would try to emerge from bankruptcy two months from the date of its filing.
The case is In re CIT Group Inc., 09-16565; U.S. Bankruptcy Court, Southern District of New York (Manhattan.)
They will do this over and over again,create a problem,seem to fix it then fold it up,Then they will do it all over with another financial group.Just think of the people that make this work,how much for your soul today?
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US 10 year bonds 3.45%… Last Monday CIT was offering 10.25%…hope none of you got scammed on this bond deal.
CIT Raises interest rate on notes to 10.25 pct from 9 pct
NEW YORK, Oct 26 (Reuters) – CIT Group Inc (CIT.N) has extended and sweetened its debt exchange offer to some of its bondholders, the lender said in a regulatory filing on Monday.
The extension applies to investors holding debt that funded CIT business in Canada, who are entitled to recover money from both Canadian assets and the parent company in the United States.
In the new offer, CIT raised the interest rate payable on its $2.15 billion series B notes to 10.25 percent a year from 9 percent, and extended the closing date of the exchange offer to Nov. 5 from Oct. 29.
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Thank you very much. I am wonderring if i can share your article in the bookmarks of society，
Then more friends can talk about this problem.
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