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— Dealwatch —
 CIT Group Inc. filed for Chapter 11 protection on Nov. 1 after months of uncertainty clouded the midmarket lender's future. 2009 Nov. 1: CIT seeks Chapter 11 protection: CIT Group Inc. filed for Chapter 11 protection on Sunday after months of uncertainty clouded the midmarket lender's future. - David Elman Oct. 27: AIG part deux?: The New York Times says he has started to build another insurance company, called C.V. Starr & Co., that would compete with the bailed-out behemoth of a company that he built up. Apparently, he's even poaching employees to create an AIG part deux. - Maria Woehr Oct. 23: CIT warns bankruptcy may leave next to nothing: As the 11th hour approaches on its comprehensive debt exchange, CIT Group Inc.'s outgoing chairman and CEO Jeff Peek in a Friday Webcast warned bondholders that if they don't either participate in the exchange or vote for a prepackaged bankruptcy the company could go into a messy "free-fall bankruptcy." - Michael Rudnick Oct. 19: CIT's debt exchange plan could still fail: The good news for CIT Group Inc. is that it will likely obtain the needed votes for a prepackaged bankruptcy to avert a free fall -- thanks to changes it made late Friday to its comprehensive debt exchange plan. The bad news: The changes may be insufficient to complete the exchanges for an out-of-court restructuring to succeed, sources said. - Michael Rudnick Oct. 19: Carl Icahn rips CIT board; offering $6B with his own plan: CIT Group Inc.'s (NYSE:CIT) latest restructuring plan has so drawn the ire of distressed investor Carl Icahn that he's now willing to step in with a $6 billion loan to restructure the troubled lender's debt. (The Deal Pipeline subscribers can read the full story on that plan here.) - George White Oct. 15: CIT faces some form of bankruptcy filing: As bondholders' resistance threatens to scuttle a controversial debt exchange, the odds are rising that CIT Group Inc. is headed for bankruptcy court through either a prepackaged or prenegotiated filing, sources said. - Michael Rudnick Oct. 13: CIT chief Peek to quit in December: Jeffrey M. Peek is stepping down as the chairman and CEO of CIT Group Inc. as speculation intensifies that the business lender must soon file for bankruptcy. The troubled New York company said in a statement Tuesday that Peek will step down at the end of the year and the board has formed a search committee. - Peter Moreira Oct. 7: CIT subdebt holders angle for sweeter debt exchange terms: Certain large bondholders of CIT Group Inc.'s $32 billion in unsecured debt may have signed off on the controversial debt exchange package, but at least one CIT creditor, Little Bear Investments LLC, is holding out for better terms. The New York merchant bank held a conference call late Tuesday with other subordinated bondholders to pressure CIT to improve the equity distribution. - Michael Rudnick Oct. 5: Will board changes force out CIT's Peek?: In an Oct. 2 regulatory filing, CIT said that it was expanding the board to 13 members from the current 10 and that some present board members may resign. A steering committee of bondholders who provided the company with $3 billion in July will recommend candidates, CIT said. - George White Oct. 5: Goldman coffers would swell by $1B if CIT bankrupt: Goldman Sachs Group Inc. will be entitled to demand $1 billion from struggling lender CIT Group Inc. should the latter file for Chapter 11 bankruptcy protection. The payout would be part of the 20-year agreement the two parties signed on June 6, 2008. - Donna Block Oct. 2: CIT's debt reduction plan may fall short: The troubled lender on Oct. 1 launched exchange offers for roughly $32 billion in unsecured debt. Bondholders will receive new secured notes and preferred stock in exchange for existing notes. - Michael Rudnick Sept. 30: CIT stock sinks amid 11th-hour talks: The stock of embattled CIT Group Inc. plummeted Wednesday as media reports citing anonymous sources said the corporate lender is in last-ditch talks to save the company. Shares of CIT were down 75 cents, or 34%, to $1.45. - Donna Block Sept. 29: Paulson sees Indy-CIT combo a viable Band Aid: Hedge fund manager John Paulson is apparently tossing around an idea of merging New York lender CIT Group Inc. (NYSE:CIT) with IndyMac Federal Bank, according to the New York Post. Later that day, however, the merger rumor was debunked. - Gerald Magpily and Sara Behunek Sept. 15: CIT faces deadline on unsecured debt revamp: CIT Group Inc. may have bought itself some time through a $3 billion loan agreement, but the lender is expected to have a restructuring plan in place for its unsecured debt by Oct. 1, analysts said. - Michael Rudnick
Sept. 4: CIT gives Peek another year as CEO: Intent on leaving the dance with the "guy who brung ya," beleaguered
commercial lender CIT Group Inc. (NYSE:CIT) gave its CEO, Jeffrey Peek,
a one-year contract extension as he tries to keep the company out of
Chapter 11. Peek will remain CEO until at least Sept. 2, 2010,
the company said in a regulatory filing that modifies tax
reimbursements and Peek's use of corporate aircraft. - George White Aug. 13: CIT to submit survival plan to N.Y. Fed: Evidently the Federal Reserve is tired of the CIT Group Inc. (NYSE:CIT) deathwatch and is taking a larger hand in deciding if the troubled middle-market lender will stay solvent. With its ability to stay out of Chapter 11 constantly in doubt, CIT said Thursday that it will spell out its survival plan in detail to the New York Federal Reserve within the next 15 days. The news sent CIT's shares up as much as 15% in Thursday afternoon trading.- George White Aug. 11: CIT falling on bankruptcy fears: Shares of CIT Group Inc. (NYSE:CIT) are down nearly 15% in midafternoon trading as the company warned it may file for bankruptcy and postponed its filing of its second-quarter earnings, according to Reuters. - Gerald MagpilyAug. 7: CIT uses Morgan Stanley, Evercore on restructuring: Despite having some well-connected help on its side, troubled lender CIT Group Inc. was unable to secure assistance from the government in its bid to stay solvent. - Vipal Monga Aug. 3: CIT Group sweetens tender offer terms: Struggling to stay afloat, CIT Group Inc. said Monday it tweaked the terms of its tender offer further to bolster its chances of paying down an upcoming debt maturity. CIT finagled a deal with its bondholders to lower the approval threshold to 58%, from an agreed-upon 90%, on a tender offer launched in late June for about $1.1 billion in bonds due on Aug. 17. - Michael Rudnick July 27: CIT's pain, Red Hat's gain: Check out the S&P 500. Troubled CIT Group Inc. (NYSE:CIT) is out, and thriving Red Hat Inc. (NYSE:RHT) is in. - Mary Kathleen Flynn July 27: What would a CIT auction look like?: If CIT Group Inc. is forced to pawn off assets while restructuring, it is unlikely to fetch top-dollar bids for any of them. So say analysts and others who follow the company, citing both the nature of a distressed auction and the lender's staggering debt load, which has cloaked the value of its units. - Thomas Zadvydas July 23: CIT's weakness to strengthen Rosenthal, Sterling?: Bloomberg says Rosenthal & Rosenthal Inc. and Sterling Bancorp are receiving additional phone calls for their factoring business from former CIT clients. CIT's factoring business is no chump change, which has grown to $42 billion in 2008. - Gerald Magpily July 23: Doubts deepen over CIT rescue plan: The lenders who offered CIT Group Inc.
a lifeline this week through a $3 billion loan appear to have
positioned themselves to take control of the company if it files for
bankruptcy protection -- a possibility that sources said is beginning to
look increasingly likely. - Vipal Monga July 22: CIT's saviors make out like bandits: Thanks to onerous terms of the rescue package, the middle market lenders -- Baupost Group, Capital Research and Management Co., Centerbridge Partners LP, Pacific Investment Management Co. LLC, Oaktree Capital Management LP and Silver Point Capital LP -- made an instant $100 million on an investment analysts say is almost risk free, according to Bloomberg. - George White July 21: Despite rescue, CIT remains on critical list: While CIT Group Inc.'s dramatic rescue may have kept it from an immediate bankruptcy filing, emerging details of the $3 billion financing suggest to some key constituents that the company may simply have delayed the inevitable. Indeed, there are some indications that the rescue loan itself makes things only more difficult for CIT in the medium term. - Vipal Monga July 20: CIT gets $3B loan from bondholders: CIT Group Inc.
bondholders agreed Monday to provide the company with a $3 billion
bridge loan to help the lender avoid a bankruptcy filing, according to
a source. The company's board has approved the deal, but the
announcement was delayed to allow time for document preparation. The
source said no material issues were holding up the pact. - Vipal Monga July 20: Monroe Credit sees opportunity in CIT trouble: One company's woes sometimes spells opportunity for others. Just ask Monroe Capital LLC. The
Chicago-based specialty finance and merchant banking firm is launching
a new advisory practice, Monroe Credit Advisors LLC, to help
middle-market companies with their financing needs as the landscape for
middle-market lending has narrowed with financial institutions such as
CIT Group Inc.(NYSE:CIT) struggling to survive. - Gerald Magpily July 17: What's to become of CIT Energy?:
Folks in the oil patch are wondering what's going to become of CIT
Energy, a unit of troubled CIT Group Inc. (NYSE:CIT). CIT Energy
finances a lot of deals and projects in the energy sector. CIT didn't
respond to requests for comment. But CIT Energy has a
sizable team in Houston. A spokesman
for J.P. Morgan Chase & Co. (NYSE:JPM) -- no slouch in the deal
funding department -- told The New York Times that if CIT couldn't
continue lending to borrowers, it would see it as an opportunity for
expansion. Maybe bondholders will save CIT -- and CIT Energy -- in the
end. - Claire Poole July 17: Could J.P. Morgan acquire CIT's assets?: On a conference call Thursday, CEO Jamie Dimon of J.P. Morgan Chase
& Co. (NYSE:JPM) said the primary effect of CIT going belly-up
would be immaterial to J.P. Morgan's P&L. I half-jokingly suggested
this was because his bank would either inherit a lot of CIT's business
or cherry-pick through its choice assets, offsetting whatever other
exposure J.P. Morgan might have to the commercial lender. - Nathaniel Baker July 17: The CIT-small business thread to become bare: There has been a slew of media reports regarding the possible CIT Group
Inc. (NYSE:CIT) bankruptcy filing and how deep of an impact it would have on a
variety of industries. And yet the message from the Obama administration seems to be that CIT is just too small to save. - Jamie Mason July 17: The middle market and the lessons of CIT: Short of a miracle, CIT Group Inc. (NYSE:CIT) seems headed for
bankruptcy, a case apparently of too-small-to-save. The CIT situation,
however, points to a number of aspects of our current situation that,
like CIT itself, get relatively little general coverage. First, CIT is
about the middle market, that vast swath of companies that
electioneering politicians routinely bow down to as the heartland of
American capitalism, but mostly just ignore (it's not even what
agriculture used to be: a potent and coherent lobbying opportunity).
Second, CIT is about a collection of lending practices, generally
gathered under the term asset-backed lending, which are suited to
middle-market operations but which are generally arcane.- Robert Teitelman July 17: CIT crisis may put NHL on thin ice: Many small and midsize businesses have been watching the
government's negotiations with CIT Group Inc. (NYSE:CIT) closely, but
one not-so-small concern is likely keeping abreast of the situation as
well: the National Hockey League. According to a report
in Canadian newspaper The Globe and Mail, CIT is a key lender to
several NHL teams, including the Ottawa Senators, Montreal Canadiens,
New Jersey Devils and Nashville Predators. - John Blakeley July 16: Markets brace for CIT fallout: With a bailout of CIT Group Inc. (NYSE:CIT) looking like it's not going
to happen, investors braced much of Thursday for the impact that a
bankruptcy filing by the lender might have. The run on the bank
continued Thursday as the company's clients rushed to max out their
credit lines before it's too late, while lenders stayed wary of
extending credit to CIT for fear of a Chapter 11 filing, worsening
CIT's financial situation throughout the day. - George White July 16: J.P. Morgan's Dimon on CIT bankruptcy: So Jamie Dimon says J.P. Morgan Chase & Co. (NYSE:JPM) won't take much of a hit if and when CIT Group Inc. (NYSE:CIT) files for bankruptcy -- an event that could happen as early as Friday. "We
have exposure to CIT, secured and unsecured, but I'm telling you, the
primary effect on [J.P. Morgan's] P&L would not be material to us,"
J.P. Morgan's chairman and CEO said on a Thursday morning conference call. - Nathaniel Baker July 15: Should CIT bondholders run for it?: When it comes to the bonds of struggling lender CIT Group Inc. (NYSE:CIT), the message from CreditSights Inc. is to flee before it's too late. In
a report released Tuesday, the credit research firm warned that even a
bailout from the government wouldn't be enough to keep the floundering
firm afloat, according to Bloomberg.- George White July 15: CIT inches closer toward bankruptcy: The company in a press release said its "board of directors and
management, in consultation with its advisors, are evaluating
alternatives." But its options seem limited. Bankruptcy is a strong
likelihood for the company, which confirmed last weekend it hired
bankruptcy specialist Skadden Arps Slate Meagher & Flom LLP.
Finding a buyer to swoop up CIT is unlikely since the company has
reportedly more than $7.4 billion due in the first quarter of 2010. - Gerald Magpily July 14: Is CIT another Lehman?: The potential demise of CIT Group Inc.,
one of the largest lenders to small and medium-sized enterprises in the
U.S., would deal a serious blow to middle-market M&A. But just how
serious is a matter of some debate. An informal survey of middle-market
dealmakers by The Deal found differing views on the gravity of such an
event, though there was some consensus that CIT's role in middle-market M&A would not be easy to fill. "In many respects, letting CIT fail is the middle-market equivalent of
letting Lehman fail," said Hector Cuellar, president of Costa Mesa,
Calif.-based investment McGladrey Capital Markets LLC. In financing
middle-market deals, "CIT has been the big player for many years," and
removing it would be sure to put a major damper on M&A activity. - Nathaniel E. Baker July 14: CIT shares rise as talks intensify: Shares
of CIT Group Inc. (NYSE:CIT) soared in Europe on Tuesday on reports
that the New York corporate lender was ramping up its discussions with
regulators on guaranteeing a bond issue before existing debt comes due.
The company's shares trading in Germany rose 21.5% to €1.20 ($1.68) at
9 a.m. ET, while the stock advanced in New York morning trading. CIT
shares on the New York Stock Exchange on Monday closed down 18 cents,
or 11.8%, to $1.35 on fears that the company may soon enter a liquidity
crisis. The shares were up over 10% late Tuesday morning. - Peter Moreira July 13: Specter of bankruptcy raised as CIT's options narrow: CIT Group Inc., yet to gain access the Federal Deposit Insurance Corp.'s
Temporary Liquidity Guarantee Program, is running out of options to
cover 2010 debt maturities as well as more than $5 billion in unfunded
commitments which could be drawn down by its borrowers. - Michael Rudnick and Peter Moreira July 13: CIT plus Skadden doesn't equal Ch. 11, right now: When a company in dire straights hires a bankruptcy specialist such
as Skadden Arps Slate Meagher & Flom LLP, does it mean it's filing
for Chapter 11? For CIT Group Inc. (NYSE:CIT), apparently not. Media
reports surfaced this weekend that CIT has hired Skadden, but the
lender to small and medium-sized businesses does not want to elaborate
about retaining the law firm. - Gerald Magpily July 10: CIT, a bomb waiting to explode: Uncle Sam may not open his wallet via the Temporary Liquidity Guarantee
Program to CIT Group Inc. (NYSE:CIT). And that could spell trouble for
the commercial lender, which owes more than $10 billion of maturing
debt through 2010 and could force the newly converted bank to raise
capital through a possible stock offering to convince the government to
give it the needed funds. - Gerald Magpily April 27: CIT may need more capital: Struggling midmarket lender CIT Group Inc. may be forced to sell assets as declining capital levels threaten its bank status, analysts said. Ratings agencies Moody's Investors Service and Fitch Ratings Ltd. slashed CIT debt to junk status on April 24 following CIT's dismal earnings results last week. - Michael Rudnick Nov. 4: Scrutiny sought of latest appeal to Treasury: The Treasury should weigh carefully whether to expand its $700 billion
rescue package to include nonbank lenders like GE Capital or CIT Group
Inc., say commercial bankers. These types of lenders have asked
Treasury to consider capital investments along the lines already in the
works for banks and insurers. Nonbank commercial lenders do not collect
deposits but do compete with banks for corporate borrowers. - Bill McConnell Visit the complete Dealwatch Archive |
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