is FORD bancrupcy candidate?

[Winetalk.com]

Ford Says Finances Sound Despite Report
Friday, March 7, 2003 7:40 PM
- AP Online

DETROIT, Mar 07, 2003 (AP Online via COMTEX) -- Ford Motor Co. said Friday its finances are sound and its revitalization plan is on track despite an analyst report that the world's No. 2 automaker could be forced into bankruptcy.

In a recent edition of Grant's Interest Rate Observer, Sean Egan of the independent credit rating agency Egan-Jones offered eight reasons why a bankruptcy filing was a possibility for Ford, including multibillion-dollar pension fund liabilities and other obligations.

A London newspaper reported a similar story Friday.

"If it didn't have the name Ford, it would be in bankruptcy right now," Egan told Grant's.

Ford spokeswoman Marcey Evans said Friday that Egan's analysis was "seriously flawed" and that Ford is "fundamentally strong."

Evans said Ford has $25 billion in cash, has gained market share of late in the United States and continues to reduce costs. On the automotive side, she said, the company's debt payments amount to $1 billion in the next five years.

Ford, which is more than one year into a five-year revitalization program, has continually said its pension obligations are manageable.

In response to market rumors that a downgrade may be forthcoming, Standard & Poor's on Friday affirmed its long-term and short-term credit ratings on Ford, its finance arm and other related entities. Its rating on Ford is near the bottom of the investment-grade scale.

Moody's on Friday also affirmed its ratings for Ford, saying the automaker appears to be making progress in its turnaround, though Moody's maintained a negative ratings outlook.

In trading Friday on the New York Stock Exchange, Ford shares were off 23 cents, or 3 percent, to close at $7.22.

Copyright 2003 Associated Press, All rights reserved


F 7.09 -0.13