GMAC: 58% of Debt Tendered

(Reuters) – Auto and mortgage finance company GMAC LLC said about 58 percent of debt has been tendered and delivery time extended in response to investors’ requests, a few days after it sweetened the terms of a much-needed debt exchange.

The company is trying to swap $38 billion of debt for a smaller amount of debt, preferred stock and cash that will help it bolster capital to become a bank and qualify for capital from the U.S. Treasury’s $700 billion rescue plan.

On Sunday GMAC sweetened terms of the debt swap to a higher annual dividend rate of 9 percent and added covenants on new notes, including restrictions on liens and asset sales.

About $16.6 billion or 58 percent of debt has been validly tendered, the Detroit-based lender said. It needs holders of 75 percent of the debt to agree to the swap.

GMAC also said the deadline for early delivery was extended to Dec. 19.

GMAC is owned in part by General Motors Corp which in 2006 sold 51 percent of GMAC to private equity firm Cerberus Capital Management LP, owner of 80 percent of Chrysler LLC.

(Reporting by Eric Yep in Bangalore; Editing by Erica Billingham)