Wednesday, December 23, 2009

Ford Motor to Ask Santa For More Common Stock

The VEBA-UAW deal eerily resembles other debt reduction initiatives undertaken by Ford Motor Company (F-$10.00) — improving liquidity and rinsing its balance sheet clean of debt, in part, by issuing new stock and swapping debt for stock. For example, during the first-half 2009 the company exchanged $4.3 billion in convertible debt for 467.9 million shares of common stock.

In the last seven quarters, common stock outstanding rose by some 65 percent to 3.24 billion, which does not include almost 933.6 million in additional shares reserved for issuance under executive bonus plans, VEBA contributions, and debentures/notes with convertible options; yet, in the same period of time stockholder equity plummeted from $5.63 billion to negative $7.3 billion, as the company burned through piles of cash and quarterly losses to survive the dark days of the Great Recession.
Read More at BNET AUTO….

Editor David J Phillips does not hold a financial interest in any stocks mentioned in this article. The 10Q Detective has a Full Disclosure Policy.

1 comment:

jesse said...

Really interesting on Ford here, right now it looks like they're just a huge macro bet on the U.S. economy recovering.