(Updates with CFO’s comment in fourth paragraph.)
Sept. 26 (Bloomberg) -- Daimler AG reached an agreement with a consortium of banks for a 9 billion-euro ($12 billion) credit line for the next five years to provide the world’s third-largest maker of luxury cars with financial flexibility.
The facility will replace an existing line worth 7 billion euros that would have expired in 2015, the Stuttgart, Germany- based manufacturer said in a statement today. Daimler has options to extend the length of the new credit to 2020.
Chief Executive Officer Dieter Zetsche has vowed to regain the top spot in luxury-car sales by the end of the decade after dropping to third in 2011. The effort to overtake Bayerische Motoren Werke AG and Volkswagen AG’s Audi will be based on investment in new models such as the GLA compact sport- utility vehicle. Daimler said it doesn’t plan to utilize the new facility, which was “substantially oversubscribed.”
“We are delighted with the great interest in this credit line,” Chief Financial Officer Bodo Uebber said in the statement. “We decided to renew the existing credit line at this early stage primarily due to the favorable market conditions, and have thus gained a sound liquidity cushion for the longer term.”
More than 40 European, American and Asian banks are a part of the consortium, Daimler said.
--Editor: Chris Reiter