Larry Will Be Happy To Read This

Porsche may be in technical default by midnight. Granted the chances are slim but it would be a fitting conclusion to Volkswagen squeeze saga. The company has a €10 billion loan refinancing due by midnight and is currently scrambling to find last minute cash to complete the deal. Market sources say the automaker has only managed to obtain €8.55 billion in commitments from banks and is facing a €1.45 shortfall. Unless banks cough up the balance, Porsche will be forced to fund the difference out of its own cash. Luckily the company does have a lot of it, compliments of many hedge funds, but that action would not be perceived well by the capital markets. Then again, the company may have no choice as a failure to refinance will lead to a technical default on the term loan, although the last thing we would advise here is to short Porsche. Sphere: Related Content

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