26 Sep 2008
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 “orderly disposition of its securities.†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The funds Goodyear has withdrawn will be used to “support seasonal working capital needs and to enhance the company's cash liquidity position,†Goodyear said.
The company said its other cash investments are fully accessible.
From Rubber & Plastics News (A Crain publication)
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