Post by Marc on Mar 28, 2005 14:10:08 GMT -6
From The Car Connection:
GM Rating Cut Inevitable, Report Says
Despite assurances from General Motors Corp.'s top executives that the company has ample cash reserves to meet its ongoing requirements, GM is preparing to sell off some assets to raise additional cash.
Nevertheless a new report from Merrill Lynch suggested that ratings on GM's outstanding debt and that of its finance subsidiary GMAC, estimated at more than $200 billion, will drop to junk status later this year.
The downgrade of a combined $200 billion in unsecured debt to junk territory would be unprecedented in capital markets, and investors should "expect a bumpy ride," Merrill Lynch said in a report issued last week.
The downgrade also would put huge pressure on GM to reduce the company's dividend to owners of common stock and certainly would undermine the company's stock price, which has tumbled through the fall and winter. GM's shares, now trading in the $29 per share range, are worth about 40 percent less than they were at the recent twelve-month peak.
www.thecarconnection.com/index.asp?article=8356&sid=173&n=156
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GM!!! BRING BACK OLDS!!!
GM Rating Cut Inevitable, Report Says
Despite assurances from General Motors Corp.'s top executives that the company has ample cash reserves to meet its ongoing requirements, GM is preparing to sell off some assets to raise additional cash.
Nevertheless a new report from Merrill Lynch suggested that ratings on GM's outstanding debt and that of its finance subsidiary GMAC, estimated at more than $200 billion, will drop to junk status later this year.
The downgrade of a combined $200 billion in unsecured debt to junk territory would be unprecedented in capital markets, and investors should "expect a bumpy ride," Merrill Lynch said in a report issued last week.
The downgrade also would put huge pressure on GM to reduce the company's dividend to owners of common stock and certainly would undermine the company's stock price, which has tumbled through the fall and winter. GM's shares, now trading in the $29 per share range, are worth about 40 percent less than they were at the recent twelve-month peak.
www.thecarconnection.com/index.asp?article=8356&sid=173&n=156
_______________
GM!!! BRING BACK OLDS!!!
