Monday, bank holding company CIT Group, Inc.(CIT) said that it will voluntarily prepay $750 million on its $7.5 billion first lien credit facility tomorrow.
The decision to re-pay the debt comes close on the heels of Former Merrill Lynch boss John Thain's appointment as Chairman and CEO yesterday. The new CEO appointment comes in the wake of the company's announcement that COO Alexander Mason will be leaving this February. Among other notable management changes, Jeffrey Peek had resigned as CEO and Chairman this January.
The company said the repayment will be made on a pro rata basis among outstanding tranches and will be subject to the applicable 2% payment premium.
CIT Group will prepay this high cost debt out of its available holding company cash position, which is in excess of $5 billion.
CIT had filed for bankruptcy in November and sought to cut $11 billion in debt from its books with its new restructuring plan. In December, CIT announced that it had re-emerged from bankruptcy shortly after winning court approval for accessing the full amount of $500 million in financing from Bank of America (BAC).
In addition, the company announced that since the terms for distribution of common shares to holders of its Contingent Value Rights or CVRs were not met on February 8, 2010 measurement date, they have expired without value.
CIT closed Monday's regular trading session at $30.61, down $0.14 or 0.46%, on the NYSE.
For comments and feedback: editorial@rttnews.com