Schaeffler gets loan lifeline

Schaeffler gets loan lifeline
Photo: DPA
Ailing German auto parts maker Schaeffler said Tuesday it has obtained a credit line of more than €1 billion ($1.3 billion) from its banks.

“The Schaeffler group has concluded an agreement with the banks bringing a credit of more than €1 billion,” a company statement said.

“With this accord, Schaeffler has given itself a greater margin to work with financially. The granting of this credit is a sign of confidence from our banks,” financial director Klaus Rosenfeld said in the statement.

No further details of the agreement were given.

The Bavarian-based manufacturer has been hard hit by the financial crisis and is struggling under a €10-billion mountain of debt.

Schaeffler took over its much bigger counterpart Continental last year but now finds itself crushed under heavy debt contracted to carry out the deal. It announced in March it would put 20,000 employees on short-time work.