Ford Slashes Debt by $3 Billion

Feb. 11, 2011
Will redeem securities for cash and stock

By redeeming securities for cash and stock as it works to regain its investment-grade credit rating, Ford announced plans on Feb. 10 to slash its debt by nearly three billion dollars.

The redemption comes after Ford reduced its debt by $14.5 billion and doubled its annual profit to $6.6 billion in 2010.

"We remain focused on reducing our automotive debt as the core automotive business continues to strengthen," said Lewis Booth, Ford CFO.

"We are pleased with the progress we have made, and we are committed to continuing to improve our balance sheet to lay a solid foundation for a strong and profitably growing business in years to come."

Ford offered holders of the securities the option of converting the securities into stock.

The redemption will lower annualized interest costs by about $190 million and will result in a first quarter charge of up to about $60 million.

Copyright Agence France-Presse, 2011

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