January 21, 2010 Old Chrysler liquidation plan moves ahead | detnews.com | The Detroit News
Old Chrysler liquidation plan moves ahead
Washington -- A federal bankruptcy judge today approved the voting process for the former Chrysler LLC to liquidate its assets.
In New York, U.S. Bankruptcy Judge Arthur Gonzalez approved the 343-page disclosure statement filed by Chrysler LLC -- also known as Old Carco LLC -- in a written order.
He set a hearing to confirm the bankruptcy plan on March 16 after the company's debtors vote whether to approve it.
Chrysler's best assets were sold in a government-backed transaction to a group led by Fiat SpA in July after the government forced it into bankruptcy on April 30. The new company is called Chrysler Group LLC.
The United Auto Workers owns a majority stake in Chrysler, but doesn't have voting rights control over the automaker. Fiat's CEO Sergio Marchionne is also running Chrysler. The U.S. Treasury is unlikely to recover most of the $4 billion in loaned to Chrysler LLC under the Bush administration.
Chrysler LLC still faces objections from Michigan taxing authorities and the Michigan Department of Environmental Quality.
In an objection filed last week, the MDEQ says Old Carco must pay nearly $3 million for environmental clean-up costs, including $116,000 already spent by the state.
"Additional work needs to be done to address environmental conditions at several facilities, including, but not necessarily limited to the Trenton Engine Plant, Evart Products Facility, Chrysler Plymouth Road Office Center, and the former Chrysler Corporation Introl division facility in Dexter," Michigan said in a court filing.
MDEQ says it believes it will cost $2.8 million to finish cleanup at those sites. Old Carco LLC and Michigan are still in talks over the issue.
Chrysler's statement discloses some sales that Chrysler LLC has made to raise funds, including 71 robots from the Newark, Del. assembly plant., They were sold for $284,000.
The company sold a foundry in Indianapolis for $177,500 and property in Indiana for $295,000.
Old Carco also sold a property in Detroit at 20250 Mt. Elliot for $2,000, but it wasn't immediately clear what the property had been used for previously.
The largest transaction to date is Chrysler's sale of its Newark, Del., plant on 271 acres. The property was sold to the University of Delaware for $24.2 million in November.
Old Chrysler is also selling off 7,600 company cars to raise funds.
Chrysler Group LLC agreed to buy 5,000 of the cars for $91.2 million -- or roughly $17,500 each. Another nearly 2,600 cars remain to be sold.
Old Carco has also decided to abandon property it deems to have no value or is in separate bankruptcy proceedings, including Action Chrysler Jeep Dodge Inc.; Chrysler de Venezuela S.A.; Chrysler Motors de Venezuela S.A.; Des Plaines Chrysler Jeep Dodge Inc.; Grapevine Chrysler Jeep Dodge Inc.; Lone Star Chrysler Jeep Dodge Inc.; Long Beach Chrysler-Jeep Inc.; and South Charlotte Chrysler Jeep Dodge Inc.
