Chrysler Group LLC on Tuesday paid back $7.6 billion in U.S. and Canadian government loans from its 2009 federal bailout, a move that allows the U.S. automaker to distance itself from an unpopular bailout and deepen its ties with Italian automaker Fiat SpA.
Chrysler said it had made payments of $5.9 billion to the U.S. Treasury and $1.7 billion to the governments of Canada and Ontario to repay loans it received in June 2009.
The automaker said it had repaid the original loans in full, more than six years ahead of schedule. Under the original terms, Chrysler had until 2017 to repay the debt.
Chrysler swapped out government debt with cheaper debt from institutional investors. The refinancing does not mean the company has less debt on its books, but it said it would save an estimated $350 million a year in interest expenses.
Chrysler paid more than $1.2 billion in interest on its debts in 2010. Chief Executive Sergio Marchionne's frustration with the terms of the government loans seemed to bubble over earlier this year when he denounced them as shyster loans.
(Reporting by Ben Klayman in Detroit and Deepa Seetharaman in Chattanooga, Tennessee; editing by John Wallace and Matthew Lewis)