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GM, subsidiary to refinance $20.6 billion in credit lines


NEW YORK -- In the largest syndicated loan package eve assembled, General Motors Corp. and its financing subsidiary, General Motors Acceptance Corp., have completed agreements to refinance $20.6 billion worth of credit lines with six syndicated credit facilities involving 118 banks.

Bankers said the refinancing agreement was a major vote of confidence by the banking community in the beleaguered automaker.

A company official said the new lines were "slightly more expensive" for the company because they involved terms up to five years, instead of one-year and three-year terms. The longer maturities give GM additional security that funds will be there if and when they are needed.

The package consists of three domestic and three international lines of credit intended mainly to back up the automaker's commercial paper. Bankers said they do not expect GM to draw on the domestic lines, but that its overseas units might use theirs.

GM and its finance unit have about $20 billion worth of debt due this year, including $7 billion worth of credit lines that guarantee its commercial paper due this month.

The refinancing agreement is second in size to the $14.5 billion raised to finance RJR's takeover of Nabisco in the late 1980s.

About $4 billion of other existing credit lines with various GM and GMAC subsidiaries in Europe, Canada and Australia are close to being completed, the company said.

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