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GM deadline crucial

Posted Wednesday, Jul 1, 2009, 11:15 am in Employee News

The U.S. Treasury Department could stop financing General Motors Corp.’s restructuring, forcing the automaker to liquidate, if a sale of GM’s best assets is not approved by July 10, President and CEO Fritz Henderson testified Tuesday in U.S. Bankruptcy Court, The Detroit News reported.

Emphasizing the deadline puts pressure on the court to endorse the sale quickly, the paper said. The Obama administration set it as a way to ensure that the sale, with so many participants, doesn’t fall apart, a person familiar with the matter told the News. But it is unlikely that the administration would push GM into liquidation, absent a major setback, given that it has agreed to invest $50 billion in the automaker’s rescue, the paper said.

Henderson said Tuesday it will cost an estimated $1.2 billion to sell and liquidate the automaker’s bad assets and cover environmental issues, the News reported. That’s up from an earlier estimate of $950 million, money needed to close dealerships, cover asbestos and product liability claims and dispose of shuttered facilities, the story said. (The Detroit News)
 
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