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GMAC Completes ResCap Debt Exchange

NEW YORK CITY-Now a bank holding company, GMAC Financial Services has swapped $21.2 billion of its old notes, falling short of a 75% goal.

By Paul Bubny | Updated on December 31, 2008

NEW YORK CITY-GMAC Financial Services, based here, has completed a $21.2-billion debt exchange of outstanding notes, including $3.7 billion in Residential Capital notes. The swap, representing 59% of outstanding GMAC old notes and 39% of outstanding ResCap old notes, fell short of the 75% goal announced in early December as a condition of Federal Reserve approval for GMAC Financial’s bid to become a bank holding company. However, the Fed had already granted bank status to GMAC on Dec. 24, an action followed on Dec. 29 by a $5-billion injection from the US Treasury.

According to a release issued on Wednesday, completion of the GMAC exchange offers will result in the issue of approximately $11.9 billion worth of new GMAC senior guaranteed notes and about $2.6 billion of new GMAC cumulative perpetual preferred stock. Completion of the ResCap offer means that approximately $688 million of new GMAC 7.50% senior notes and about $483 million of new GMAC 8.00% subordinated notes will be issued.

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