Dodge Nitro Forum banner

1 - 3 of 3 Posts

·
Super Moderator
Joined
·
23,864 Posts
Discussion Starter #1
GM’s latest plan would cede control to U.S.

Posted Tuesday, Apr 28, 2009, 12:32 pm in Employee News

The U.S. Treasury Department would own a majority of General Motors Corp. and have the right to appoint all of its directors, under the company’s turnaround plan unveiled Monday—the latest sign of the government’s growing role in the automaker’s restructuring, according to The Detroit News.

The administration also told the Detroit automaker it wouldn’t support giving bondholders any more than 10 percent equity in the company, the paper reported. That hard-line offer could be a major factor in bondholders rejecting the exchange and forcing GM into bankruptcy, analysts told The News. The Obama administration has boosted the percentage of debt it wants the automaker to write off to at least 90 percent, up from two-thirds, the paper said.

GM’s bondholders came out swinging, saying the company’s offer of just 10 percent equity in exchange for $27.2 billion in bonds was inadequate, the News said.

“This offer demonstrates that the company and the auto task force, unfortunately, are pinning their hopes on an extremely risky and legally questionable turnaround in bankruptcy court, instead of engaging its lenders and workers in the very type of negotiations that could avoid such a fate,” an ad hoc committee of GM’s bondholders said told the paper. (The Detroit News)
 

·
Super Moderator
Joined
·
23,864 Posts
Discussion Starter #2
We don’t want to run GM

White House: We don’t want to run GM

Posted Tuesday, Apr 28, 2009, 12:56 pm in Employee News

The White House said yesterday that the government does not want to run General Motors Corp., despite GM’s restructuring plan that would give the Treasury 51 percent of the company, the Detroit Free Press reported.

The swap of debt-to-stock proposed by GM on Monday must meet the approval of the Obama administration, which has set a target of 90 percent acceptance from bondholders who own $27 billion in GM debt, the Free Press said. The automaker warned that should it not reach that target, it would consider a bankruptcy where the government would buy much of GM’s assets, the paper said.

President Obama has said the administration did not want to manage an automaker the story said. “This administration and this government have no desire to run an auto company on a day-to-day basis,” White House spokesman Robert Gibbs told reporters. “It is not our desire to own or run one of the auto companies.” (Detroit Free Press)
 
1 - 3 of 3 Posts
Top