Judge Clears Way for GM To Leave Bankruptcy
July 09, 2009
By Michelle Krebs
NEW YORK -- A U.S. bankruptcy judge has cleared the way for General Motors to leave Chapter 11 by approving the sale of some of the automaker's assets, including the Buick, Cadillac, Chevrolet and GMC divisions, to a new, largely government-owned company.
Judge Robert Gerber of the U.S. bankruptcy court in New York ordered the approval of asset sale, despite the filing of 11th-hour appeals. GM will close the sale Friday morning and hold a press conference immediately after to provide details.
Judge Robert Gerber wrote in his ruling that allowing the sale was in the public's best interest, by saving jobs and health-care coverage for hundreds of thousands of employees and retirees globally as well as the tax base of communities. "If GM were to have to liquidate, the injury to the public would be staggering," he said.
GM expects to close on the new GM 9 a.m. Eastern time Friday. A press conference with GM CEO Fritz Henderson and new board chairman Ed Whitacre will follow.
Sometime after the closing of the sale, GM is expected to reveal its new corporate structure, which will mean thousands of fewer salaried jobs including hundreds less in the executive ranks.
The new GM will be 60.8 percent owned by the U.S. government, 17.5 percent owned by the United Auto Workers union's retiree health care fund and 11.7 percent owned by the governments of Canada and its Ontario province.
The old GM will remain in bankruptcy, its assets eliminated or liquidated in the years ahead.
Posted by Michelle Krebs at 10:19 AM under Featured , GM , News | Comments (1) | digg this | Seed Newsvine
I see that Douglas Steenland is on the Board of Directors of the new Bureau of General Motors.
Outsource was his mantra at Northwest Airlines; slash and burn was how he saved that airline.
Much of the methodology used to rescue the B of GM and the new old new new Chrysler is similar to that of the reorganization at NWA.
It should be interesting to see what effect his influence will have at the RenCen. The UAW, Buick and GMC should check their rear view mirrors often.
Posted by: fulcrumb | July 09, 2009 at 3:04 PM