GM Ends Credit Line, Suggesting Improved Health
January 07, 2008

In a sign of improving health, General Motors ended a $4.1 billion line of credit it had negotiated with banks because it no longer needed it.

The company believes it has sufficient liquidity going into 2008 and does not need the borrowing agreement, various financial journals reported.

The credit agreement was drafted in June 2007 using GM's 49 percent stake in GMAC as collateral, but was never borrowed against.

GM's liquidity situation has been helped by a sell-off of assets, including about half of GMAC to Cerberus Capital Management, Allison Transmission to a Canadian equity firm and its medium-duty truck business to Navistar.

The move suggests GM expects to be profitable soon.

Posted by Michelle Krebs at 1:31 PM under GM | Comments (1) | digg this | Seed Newsvine