Reuters reports CIT Group (NYSE:CIT) is seeking a $5 – $7 billion DIP loan. These type of loans, known as debtor-in-possession, are usually provided for companies in financial distress or under Chapter 11 bankruptcy process. This latest development suggests that the prospects for a positive resolution, even on a minimal scale, on the co.’s current status are growing even more distant.
CIT Group, notes Reuters, is planning to get the loan if its planned debt exchange offer fails and it files for prepackaged bankruptcy, sources familiar with the matter said on Thursday.
CIT has not finalized the loan yet but would do so over the next few days, if it has to file for bankruptcy, the sources told Reuters. In short, the CIT saga, continues.