Credit Acceptance Announces Completion of $75.0 Million Revolving Secured Warehouse Facility
Credit Acceptance Corporation (NASDAQ: CACC) announced today the completion of a $75.0 million revolving secured warehouse facility with an institutional investor.
Under this facility, we will contribute loans to a wholly-owned special purpose entity and the SPE may borrow up to the lesser of 80% of the net book value of the contributed loans or $75.0 million during the facility's revolving period. The facility will cease to revolve on February 19th, 2014. If the facility is not renewed prior to this date, and we and the SPE are in compliance with the terms and conditions of the agreement, any amounts outstanding will be repaid over time as the collections on the loans securing the facility are received. We initially contributed loans having a net book value of $54.0 million to the SPE and the SPE borrowed $41.0 million under the facility. The proceeds of the financing will be used by us to repay outstanding indebtedness.
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