They actually managed to get financing on over half a billion dollars worth, half coming from Uncle Warren himself, the other half from current stockholders who have seen their shares plummet over the past month. All I can say is that if HOG is the best Berkshire can do, look out, because I think the HOG fantasy, like $10 million Super Bowl parties are close to being over.
LOL, so they are going to make money by borrowing at 15% and then lend it out at what, half that? That's a great business plan. Oh, and look who the players are in arranging the financing… Well, at least America can still produce a motorcycle, even if they are poorly engineered and all about image!
Harley-Davidson, Inc. Prices Offering of $600 Million of Senior Unsecured Notes
Proceeds Intended to Provide Funding for Ongoing Lending Activities of Harley-Davidson Financial Services
MILWAUKEE, Feb. 3 /PRNewswire-FirstCall/ -- Harley-Davidson Inc. (NYSE: HOG) today priced an offering of $600 million of its senior unsecured notes as part of the Company's plan to fund the ongoing motorcycle lending activities of its wholly owned finance company, Harley-Davidson Financial Services (HDFS). Davis Selected Advisers, L.P., a long-time investor in Harley-Davidson, Inc. and the largest holder of Company stock, and Berkshire Hathaway, Inc. each committed to purchase equal portions of the aggregate principal amount of the notes. The offering is being made under the Company's existing shelf registration for public offerings of securities, including debt. The notes will be due in 2014 and will bear interest at a rate of 15 percent per annum.
"This offering represents an important next step in executing our stated strategy for funding the lending activities of HDFS," said Tom Bergmann, Chief Financial Officer of Harley-Davidson, Inc and Interim President of HDFS.
In late January, Harley-Davidson unveiled a three-part strategy to attempt to address the current economic environment. That three-part strategy focuses on stimulating consumer demand by investing in the Harley-Davidson brand, getting the Company's cost structure right, and securing additional funding for HDFS, which makes wholesale loans to dealers and retail loans to consumers.
The offering was arranged by Morgan Stanley, and Citigroup, Deutsche Bank Securities, J.P. Morgan and Morgan Stanley acted as lead underwriters for the transaction.
Hey, how far you going to lean that puppy around a corner?! Yes, the wheels have already come off this HOG...
Bob Seger - Roll Me Away:
Hey, that looks like fun, I'm going to have to get me one of those!