Congratulations to Ford, the automaker which did NOT accept a federal government bailout. From Bloomberg/BusinessWeek:
Ford Motor Co. was raised to investment grade by Moody’s Investors Service, enabling Executive Chairman Bill Ford, great-grandson of the founder, to reclaim the blue oval logo he put up as collateral for a loan.
“When we pledged the blue oval it was enormously emotional for me personally and for my family, because we weren’t just pledging an asset, we were pledging our heritage,” Ford told reporters yesterday on a conference call. “To get that back feels wonderful and this is one of the best days I can remember.”
Moody’s boosted Ford’s senior unsecured ratings two levels to Baa3 from Ba2 and raised its finance arm, Ford Motor Credit, to Baa3 from Ba1. Moody’s followed Fitch Ratings in assigning an investment-grade status. With two such ratings, Ford regains control of the logo and other assets pledged as collateral to obtain a $23.4 billion loan to keep the business going in 2006.
When the upgrade came, Bill Ford said he announced it to employees on the public-address system normally used for fire drills in Ford’s Dearborn, Michigan, headquarters. Moody’s had ranked the second-largest U.S. automaker’s debt as junk since August 2005. Fitch returned Ford to investment grade last month after assigning it junk status in December 2005.
“The upgrade of Ford recognizes the strength of the company’s position in North America, its robust liquidity position, and our expectation that the company will continue to embrace sound operating and financial disciplines,” Moody’s said in a statement. “We believe that these strengths will enable Ford to maintain an investment-grade profile in the face of the sector’s ongoing cyclicality and weakness in the European market.”
Executive Chairman Bill Ford’s entire statement can be found here, along with a synopsis of the company’s recent six year history.