Summary Box: Chrysler to repay $7.5B of loans

AP News
Posted: Apr 28, 2011 5:17 PM

THE PLAN: Chrysler will repay $7.5 billion in government bailout loans by taking out new loans and selling bonds.

THE REASON: Italy's Fiat SpA, which has management control of Chrysler, wants to repay the loans so it can raise its ownership stake in the U.S. company and lower interest payments. It's also a major step toward a Chrysler public stock offering.

THE BOTTOM LINE: The refinancing will repay $1.6 billion from Canada. It won't repay the entire U.S. bailout package of $10.5 billion, though. About $2 billion remains unpaid, some of which will be lost.