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GM bankruptcy almost inevitable
Experts say GM bankruptcy almost inevitable
Posted Monday, May 11, 2009, 12:12 pm in Employee News
For General Motors Corp., the task at hand is so difficult that experts say a Chapter 11 bankruptcy filing is all but inevitable, the Associated Press reported.
To remake itself outside of court, GM must persuade bondholders to swap $27 billion in debt for 10 percent of its risky stock, the news service said. On top of that, the automaker must work out deals with its union, announce factory closures, cut or sell brands and force hundreds of dealers out of business—all in three weeks, the AP reported.
“I just don’t see how it’s possible, given all of the pieces,” Stephen J. Lubben, a professor at Seton Hall University School of Law who specializes in bankruptcy, told the news service. GM, which has received $15.4 billion in federal aid, faces a June 1 government deadline to complete its restructuring plan. If it can’t finish in time, the story said the company will follow Detroit competitor Chrysler LLC into bankruptcy protection. (Associated Press/Detroit News)
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Rick
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