Mitsubishi Motor Corp. has announced it will receive a 450 billion (US$4 billion) capital infusion, yet the fate of its U.S. finance unit remains unclear. Speculation continues over the potential impact a sale of the finance company would have on MMCA floorplan and lease securitizations.
"There is a fair amount of variability with regard to whether they sell, who they might sell to and what the capabilities of that party might be," said Moody's Investors Service Managing Director Michael Kanef. "There is currently a substantial value in the retained pieces of the securitizations, so there is tremendous incentive to maximize that value."
The Mitsubishi industrial group - which includes Mitsubishi Corp., Mitsubishi Tokyo Financial Group Inc. and Mitsubishi Heavy Industries Ltd. - will provide $2.4 billion through preferred-share purchases and debt-for-equity swaps. Phoenix Capital, a Tokyo-based investment fund, will step in with roughly 70 billion (US$631.1 million) in financing to become the largest shareholder with a roughly 40% stake.
The new funding should largely cancel out the effect of DaimlerChrysler AG's decision to withdraw its $6.4 billion equity stake last month. Investors had been concerned about servicing and vehicle disposition in the event of a bankruptcy (see ASR 5/3).
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