CIT Scrambling For $5-7 Billion DIP Loan
As prospects for an amicable resultion at Club CIT grow ever more blacklightish, the company is now alleged to be desperately seeking a $5-7 billion DIP loan (the kind you need when you file for Chapter 11, and when all your existing equity is wiped out). Reuters:
CIT Group Inc is planning to get a debtor-in-possession loan of $5 billion to $7 billion if its planned debt exchange offer fails and it files for prepackaged bankruptcy, sources familiar with the matter said on Thursday.
CIT has not finalized the loan yet but would do so over the next few days, if it has to file for bankruptcy, the sources said, declining to be identified because the talks are private.
Our advice to CIT: approach investment advisory guru Jim Cramer: it was a long and arduous 48 hours ago (and 100% higher) that the soon to be Comcast employee was pronouncing how the stock was "primed for upside." If there is anyone who would put their money where their mouth is, Jim Cramer is your man. And to a former hedge fund manager of Jim's caliber, $7 billion is parking meter money.