Were you aware that Essent is a bennificiary of the bailout? In kind of a round-about way. Remember the Six Degrees of Kevin Bacon? Well, GM is accepting a bailout, GMAC is 49% owned by GM, GMAC-RFC is totally owned by GMAC, and GMAC-RFC loaned Essent $75 Million to buy PRMC.
Monday, April 13, 2009
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With GM possibly looking at bankruptcy, one has to wonder if GMAC will be affected, or if it will be spun off to another firm. GM has run thru a boatload of bailout money, and according to reports may shut down most of their plants for up to 9 weeks.
So Essent's funding may not be as secure as first thought......unless some company with deep pockets and enough money to burn a wet mule buys GMAC and keeps it operating.
Knowing GMAC is not the only source of cash for Essent, I wonder how, say, Vesta (sp?) is doing? Will the lending firms start cutting the money pits and bad risks?
Essent isn't out of the woods yet, and therefore so are none of their hospitals.
I actually put that up as a joke- ;-)
But, who knows what the court will do. GMAC was actually fairly profitable, but I don't know what it's status will be in GM's possible bankruptcy.
Could they call the loan? GE Capital is a source of day-tp-day capital, but they've had their issues, and remember that they took the Ayer mortgage...and virtually a week after the hospital announced that they weren't going to build the new one, merely renovate the old.
Would they be willing to take up the slack?
May you live in interesting times.
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