Ford To Issue Around $1 Billion In Bonds

Ford (NYSE: F) is to float a new bond issue, according to a filing with the Securities and Exchange Commission, reports Dow Jones. The report quoted a person familiar with the deal as estimating that the bonds will yield 8.25-8.375% and total approximately $1 billion.

The proceeds of the issue will be used for the carmaker’s general funds, according to the SEC filing. Ford is the only one of the “big three” Detroit automakers that has not filed for bankruptcy protection in the wake of the economic slowdown.

The upcoming issue will be the latest in a series for Ford. Thus far in 2009, the company has raised $3.85 billion in three bond issues. Although the company’s bonds are rated as “highly speculative”, the company’s cost of borrowing has steadily lowered throughout those three issues, from 13% to 10.875% to 9%.

The current Ford bond offering is being underwritten by Citigroup (NYSE: C), Merrill Lynch, J.P. Morgan Chase & Co. (NYSE: JPM) and Morgan Stanley (NYSE: MS).