Chrysler to Announce Bailout Repayment Tuesday

PRNewsFoto/Chrysler Group LLC, Jim Fets(DETROIT) -- Chrylser is expected to formally announce Tuesday the repayment of the $7.5 billion bailout loan it received from taxpayers, the Wall Street Journal reports.  

Chrysler chief executive Sergio Marchionne and White House advisor on manufacturing Ron Bloom will make the announcement during a visit to a Sterling Heights, Mich. auto plant Tuesday.  

Just two years ago, the auto maker was forced to file for bankruptcy.  But last week, Chrysler entered into a loan and bond deal with private banks making it possible for the company to repay U.S. taxpayers sooner than expected.

The deal includes $3.2 billion in bonds, $3 billion in a term loan and a $1.3 billion revolving credit facility, according to the Wall Street Journal.  Italian auto manufacturer Fiat will help to complete the payment with $1.3 billion cash to Chrysler.  

Chrysler reportedly paid $1.2 billion in interest on the loan last year, but WSJ reports the new deal will allow the company a new rate below 10 percent, saving it $300 million a year.

Copyright 2011 ABC News Radio

Chrysler Set to Repay US Taxpayers Early?

PRNewsFoto/Chrysler Group LLC, Jim Fets(DETROIT) -- After surviving a near-death experience, Chrysler could pay back its government “bailout” loans as early as next week -- six years ahead of schedule.

Automotive News reports that Chrysler Thursday wrapped up a Wall Street re-financing package that will allow the company to repay American taxpayers nearly $6 billion. The U.S. hopes to eventually recover most of its remaining investment -- around $2 billion -- by selling its ownership stake.

On the brink of collapse only two years ago, Chrysler last month reported its first quarterly profit since exiting bankruptcy.

Copyright 2011 ABC News Radio