Carmax Finance, the automotive finance arm of Nissan Motor Co., said it had raised $9.7 billion from an unnamed source to fund its $1.6 billion loan to Nissan Motor Corp. and its U.S. affiliate, Nissans.
The loan was originally announced in January.
The financing comes as Nissan’s U.K. and U.A.E. operations continue to face challenges.
Read MoreHere’s what we know so far about the financing:1.
The Nissan loan is an equity loan to be paid back in 2019, rather than 2019 as previously planned, meaning that Nissan will receive the full value of its investment as long as it continues to make profit.
The interest rate on the loan will be 8.95 percent, down from 9.25 percent initially.
The amount of the loan is expected to be approximately $9,000 per vehicle.2.
The bond issued by Nissan is backed by the Japanese government, and Nissan will use the proceeds to pay dividends to shareholders.
The company expects to make a $2 billion profit this year on the sale of a new line of Nissan LEAF electric cars, according to Bloomberg.3.
The money raised through the loan, which was first reported by Reuters, will go toward a new business unit that Nissan plans to establish to expand its electric vehicle business.
It will also pay for vehicle upgrades to existing vehicles, Nissan said.4.
Nissan plans for its U,A.
Es. to begin producing vehicles in 2020, with the aim of selling cars there by 2025.
Nissan has invested $2.7 million in U.
E., which has already announced a production line in China.5.
Nissan will finance its U-A.I. loan through a new bond that will be backed by an undisclosed amount.6.
Nissan is also looking to tap into a fund that is tied to the Japanese central bank, the Bank of Japan.
This fund has been used to buy up bonds issued by other Japanese banks.7.
Nissan hopes to build a factory in Mexico to manufacture the electric vehicle units.
This is expected later this year.8.
E.’s chief financial officer, Shigeki Yabe, is a former Mitsubishi employee.
Nissan announced in February that it would hire him as a board member.