CIT Group
CIT Group, Inc. is a global commercial finance company that provides a comprehensive set of financial products and advisory services to the middle market, founded in 1908. The company has 200+ offices in 50+ countries. CIT is included in the Fortune 500 and is a leading participant in vendor financing, factoring, equipment and transportation financing, Small Business Administration loans, and asset-based lending. The company does business with more than 80% of the Fortune 1000, and lends to a million small and medium businesses.[3] It was a part of the S&P 500 Index, was replaced by Red Hat at the close of trading July 24, 2009.[4]The company has its headquarters in New York City, and employs more than 7,300 people in locations throughout North America, Europe, Latin America, and Asia Pacific. The company's name is an abbreviation of an early corporate name, Commercial Investment Trust.
In 2008, CIT Group became a bank holding company in order to qualify for, and ultimately receive, $2.3 billion in Troubled Asset Relief Program (TARP) funds.[11] It declared Chapter 11 bankruptcy on November 1, 2009, and with the consent of its bondholders proposed to quickly emerge from bankruptcy court proceedings.
On July 1, 2008, CIT Group announced that it would be selling its home lending division to Lone Star Funds for $1.5 billion in cash in addition to the $4.4 billion in debt the company held. CIT said it would concentrate on its commercial pursuits due to the decline in housing and mortgage markets of the past year. CIT also planned to sell their manufactured housing portfolio Vanderbilt Mortgage and Finance Inc. for approximately $300 million, although it held a value of $470 million.[10]On July 13, 2009, Bloomberg TV reported that CIT was asking for FDIC loan guarantees.
On July 15, 2009 the common stock of CIT was halted on the NYSE during trading hours with "News Pending". At 6:03 p.m. a press release was issued on the company's website stating that talks of a government bailout were unlikely. The company had been advised that there was "no appreciable likelihood of additional government support being provided over the near term."[12] CIT announced that it believed it was unlikely that it would receive further funding from the federal government, and CIT Group came very close to declaring bankruptcy.[13][14][15] It was rescued in a US$3 billion deal on 19 July 2009, via an agreement with the bondholders group, which included Pacific Investment Management Company (PIMCO) and some other top CIT holders.[16] CIT said it planned a comprehensive restructuring of its liabilities.[17]
On September 30, 2009, in its continuing struggle to avoid bankruptcy, CIT Group was reported to be in negotiations with Citigroup Inc., Barclays Capital, and its bondholders to secure rescue financing to comply with its filing to find a plan “acceptable” to the majority of a bondholder steering committee that provided it with the emergency cash by Oct. 1.[18]
On Sunday, November 1, 2009, CIT Group filed for Chapter 11 bankruptcy protection.[19][20][21] It filed in the United States Bankruptcy Court for the Southern District of New York along with CIT Group Funding Company of Delaware LLC.[22]
On December 10, 2009, CIT satisfied all of the conditions required to consummate the prepackaged Plan of Reorganization (the "Plan"). The distribution of CIT's new debt and equity securities took place in accordance with the Company's confirmed Plan and the new common stock commenced trading on the New York Stock Exchange (NYSE) under the symbol "CIT." All previously issued and outstanding common stock and preferred stock was cancelled.[23]
