Of course there is no way they would try to abuse the 363 sale process again since that trick is kind of old.
General Motors Corp’s plan for a bankruptcy filing involves a quick sale of the company’s healthy assets to a new company initially owned by the U.S. government, a source familiar with the situation said on Tuesday.
The source, who would not be named because he was not cleared to speak with the media, did not specify a purchase price. The new company is expected to honor the claims of secured lenders, possibly in full, according to the source.
The remaining assets of GM would stay in bankruptcy protection to satisfy other outstanding claims.
WOOPS. Yes, sure enough, here it is again. Of course, part of the problem here is that much of GM’s debt is spread out down to even retail levels. Craming down Grandma UAW’s GM bonds is, ironically, going to be much less easy than screwing over a few hedge funds, both public relations wise and as a practical matter.
GM bankruptcy plan eyes quick sale to gov’t [Reuters]
WHAT!
We believe that seeking relief under the U.S. Bankruptcy Code, if such relief does not lead to a quick emergence from Chapter 11, could materially adversely affect the relationships between us and our existing and potential customers, employees, suppliers, dealers, partners and others. For example:
• it is likely that such a filing would substantially erode consumers’ confidence in our ability to provide parts and service over the long-term, ensure the availability of warranty coverage (which in the United States may depend on the continuation and consumer perception of the U.S. Government’s warranty program) or maintain acceptable resale values and that as a result there would be a significant and precipitous decline in our global revenues, profitability and cash flow;
• a significant decline in revenue would endanger the viability of our dealers and suppliers, threaten the ability of GMAC to fund itself and impair its capacity to provide essential wholesale and retail financing to our dealers and customers;
• employees could be distracted from performance of their duties, or more easily attracted to other career opportunities;
• it may be more difficult to attract or replace key employees;
• suppliers, dealers and partners (including certain joint-venture partners) could seek to terminate their relationship with us, require financial assurances or enhanced performance, or refuse to provide trade credit on the same terms as prior to the reorganization case under Chapter 11;
• lenders to subsidiaries that are not subject to the bankruptcy proceedings could, in certain cases, terminate financing agreements, accelerate amounts due thereunder or otherwise claim an event of default has occurred thereunder;
• we could be forced to operate in bankruptcy for an extended period of time while we tried to develop a reorganization plan that could be confirmed, which we believe will significantly and permanently impair our business and prospects;
• certain of our non-U.S. subsidiaries may be required to seek bankruptcy or similar relief under proceedings outside the United States which would adversely affect their businesses;
• we may not be able to obtain debtor-in-possession financing to sustain us during the reorganization case under Chapter 11, particularly if we do not have U.S. government support;
• if we were not able to confirm and implement a plan of reorganization or if sufficient debtor-in-possession financing were not available, we may be forced to liquidate under Chapter 7 of the U.S. Bankruptcy Code; and
• any distributions to you that you may receive in respect of your old notes under a liquidation or under a protracted reorganization case or cases under Chapter 11 would likely be substantially delayed and the amount of any potential recovery likely could be adversely impacted by such delay.
As a result of the foregoing, if we seek bankruptcy relief, holders of old notes may receive consideration that is less than what is being offered in the exchange offers, and it is possible that such holders may receive no consideration at all for their old notes. In particular, we believe that liquidation under Chapter 7 of the U.S. Bankruptcy Code would likely result in no distributions being made to our general unsecured creditors (including holders of old notes) or to our equity holders.
considering GM bonds are trading at what, $5, does it really matter? Anyone who held this long deserves a donut for their indifference/blind hope/whatever.
@2 – Thanks for using bullets. I’m sure it’s much more concise than the ad nauseam stream of liquid shit that I’m sure you had first thought to paste in.
@2 never thought I’d post this, but TLDR.
TLDR? Teldar Paper?
@2 – is that the royal we?
#6, he’s saying “Too Long, Didn’t Read.”