Amazon Secures a $8 billion Loan to Safeguard Against Economic Difficulties
- ByStartupStory | January 6, 2023
The $8 billion Term Loan that DBS Bank, Mizuho Bank, and others have provided to e-commerce giant Amazon would be used for “general corporate purposes.” The company stated in a filing with the US Securities and Exchange Commission (SEC) that the loan has an option to be extended for an additional 364 days and will mature in 364 days (on January 3, 2024)
“Upon funding, proceeds of the Term Loan will be used for general corporate purposes. Upon an event of default that is not cured within applicable grace periods or waived, any unpaid amounts under the Term Loan may be declared immediately due and payable and the commitments may be terminated,” it said in the filing.
In a statement to a media company, an Amazon spokesperson said the loan has been taken to safeguard against the “uncertain macroeconomic environment”.
The spokesperson said, “Given the uncertain macroeconomic environment, over the last few months we have used different financing options to support capital expenditures, debt repayments, acquisitions and working capital needs.”
Amazon intends to downsize its employment by as many as 10,000 employees in early 2023 in order to cut costs. There have even been some reports that put the number of layoffs around 20,000. Amazon’s retail operation has stopped hiring for corporate positions.
In an effort to save money, the company has also postponed the joining dates of some recent graduates who were scheduled to begin working there in May. According to the company, the pupils won’t be able to start until the end of 2023. The Alexa virtual assistant company and the Luna cloud gaming section will be particularly affected by the job losses, and corporate staff have been warned that they will be laid off.
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