The pre-packaged bankruptcy is expected to last 30 to 90 days, and GM will receive some $30 billion in U.S.-guaranteed loans.
GM is expected to emerge from bankruptcy considerably smaller, after shuttering or selling an estimated 14 plants as part of its bankruptcy. Debt-holders and the United Auto Workers will end up with a stake in the remaining company, while the U.S. government will be GM’s largest owner.
Meanwhile, a federal bankruptcy judge has approved the sale of most of Chrysler assets to Italian automaker Fiat.
The sale approval presumably clears the way for Chrysler to exit its own court protection within 60 days.
Chrysler’s plan gives a 55% share of the new company to a UAW trust for retirees, a 20% stake to Fiat and smaller shares to the U.S. and Canadian governments. Fiat’s share could grow to 35% under the plan. (Tire Review/Akron)