Chrysler raises $7.5 billion to repay debt

By the Associated Press | May 19, 2011 | 5:43 PM EDT

DETROIT (AP) — Chrysler Group will repay its debts to the U.S. and Canadian governments after raising $7.5 billion with a new refinancing plan.

The company said last month that it planned to repay its loans in the second quarter, and announced the financial details Thursday. Chrysler is issuing $3.2 billion in notes and taking on $4.3 billion in new debt.

Chrysler took $10.5 billion from the U.S. government to survive two years ago and has repaid some of that. The refinancing, along with funds from Italian automaker Fiat SpA, will allow it to repay the rest.

The company is eager to cut ties with the government so it can improve its image and get more favorable interest rates on its debt.