The logos of automobile companies (LtoR) Abarth, Lancia, Fiat, Alfa Romeo and Jeep are pictured at the entrance to the Fiat Chrysler Automobiles (FCA) at the Fiat Mirafiori car plant on May 27, 2019 in Turin, northern Italy.
Marco Bertorello | AFP | Getty Images
Fiat Chrysler has set up a $3.84 billion emergency credit facility as it attempts to manage through the coronavirus pandemic that has forced it to shutter many of its operations globally.
The Italian-American automaker said Thursday the funds will be available for “general corporate purposes and for working capital needs.”
The credit facility, with two unnamed banks, is structured as a bridge facility, or short-term loan. Funds can be drawn in a single tranche, with an initial 12-month term which can be extended at the company’s option for an additional 6-month terms.
Shares of Fiat Chrysler were down by about 1.5% in pre-market trading following the announcement. The stock is down 49.4% so far this year and 49.7% over the past 12 months.
The new credit facility is in addition to Fiat Chrysler’s existing credit facilities of about $8.5 billion, including bi-lateral credit lines worth $1.65 billion that the company said it has started to draw down.
Fiat Chrysler was impacted earlier than other automakers as COVID-19 spread globally from China. The company has many factories in Europe, particularly Italy, that had to temporarily shutter due to the pandemic.
Pressured by the United Auto Workers union last week, Fiat Chrysler as well as General Motors and Ford Motor also announced plans to shutter domestic plants in an attempt to curb the spread of the disease.