Business Services Industry
Auto lender holds road. (Credit Acceptance Corp.)
Crain's Detroit Business, April, 1997
Credit Acceptance steady in rocky industry Credit Acceptance Corp.'s stock is still struggling, but the company is still able to sell debt on the open market. The Southfield-based specialty auto finance company raised $71.75 million in a sale of unsecured notes two weeks ago - money that will be used to pay down short-term bank debt.
Credit Acceptance will pay 7.71 percent interest on the notes, sold to a consortium of seven insurance companies. That's higher than the bank debt, which carried a rate of 0.825 percent interest over the current Eurodollar rate. That works out to about 6.6 percent. However, Richard Beckman, Credit Acceptance president and CEO, pointed out that the notes carry a longer maturity than the bank debt. "Our strategy is to fix debt so we...
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