CIT Amends Terms of Notes Offer - TheStreet

CIT Amends Terms of Notes Offer

The lender warns in a regulatory filing Friday it may have to seek bankruptcy protection if enough bondholders don't agree to the terms.
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Updated from 12:46 a.m. EDT

CIT Group is amending the terms of a tender offer for its notes but warns it may have to seek bankruptcy protection if enough bondholders don't agree to the terms.

In a regulatory filing Friday, CIT said if the offer is successful it won't file for bankruptcy and will pursue a restructuring through other unspecified ways, the

Associated Press



Wall Street Journal

reports Friday that CIT received bids to buy parts of the troubled commercial lender from

Berkshire Hathaway


Leucadia National


but turned them down because the price was too low.

The company's aviation-finance and rail-finance operations are the units most likely to be sold, said people familiar with the matter, cautioning that CIT's analysis is still in early stages, the



CIT has identified about a half dozen potentially interested bidders for the railcar business,


reports, citing a person with knowledge of the plans. CIT put the unit up for sale last year, but took it off the market when bids came in below expectations, the person said.

CIT is likely to keep its corporate-finance department, its largest division, and its factoring business, which provides trade finance to retailers and small retail vendors, the



Less certain is the fate of its vendor-financing business, which allows companies to finance their customers purchase. Earlier this week,


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said it terminated its vendor-financing agreement with CIT, the



It was reported by


Thursday that advisers to the bondholders that rescued CIT earlier this week with a $3 billion loan are recommending creditors push the company into Chapter 11 bankruptcy after a debt swap next month.

CIT secured the $3 billion loan facility from a group of its major bondholders, allowing it to stay out of bankruptcy for the time being. The loan aims to sustain the company long enough for it to rework its heavy debt load, but doesn't guarantee it can stay out of bankruptcy.