The U.S. unit of carmaker Fiat Chrysler Automobiles (FCA)(FCHA.MI) (FCAU.N) has redeemed senior secured notes that mature in 2019 with a total face value of $2.875 billion, a filing with U.S. market regulator SEC showed, reports Reuters.
The notes, which carry a coupon of 8 percent, were redeemed at a price equal to their principal amount plus the applicable premium and any accrued and unpaid interests, according to the filing.
Fiat completed the buyout of its U.S. unit last year but needs to refinance all of Chrysler’s bonds and past credit agreements before it can gain full access to the unit’s cash. After this payment, FCA still has to repay or refinance Chrysler bonds due in 2021 and renegotiate other credit agreements.
Having full access to Chrysler’s money will help FCA carry out an ambitious five-year investment plan that includes spending 48 billion euros ($55 billion) to 2018 to boost sales by 60 percent to 7 million cars and increase net profit five-fold.