Akron, Ohio -- Goodyear plans to draw $600 million from its US revolving credit facility because it couldn't access $360 million in cash invested in the Reserve Primary Fund.
The Reserve Primary Fund -- one of the oldest and largest money market funds -- delayed requests to pay redemptions after an order from the Securities and Exchange Commission allowing an â€œorderly disposition of its securities.â€ The fund, which had held $785 million in bonds issued by the failed Lehman Brothers investment company, saw its value fall below the $1 per share threshold, and it is facing a lawsuit from some investors, according to news reports.
The funds Goodyear has withdrawn will be used to â€œsupport seasonal working capital needs and to enhance the company's cash liquidity position,â€ Goodyear said.
The company said its other cash investments are fully accessible.
From Rubber & Plastics News (A Crain publication)