It's one thing to say that a firm might be better off in bankruptcy. It is another entirely to prod it down the plank towards the sea.
General Motors Corp.'s 60-day deadline to restructure is unlikely to be extended because the U.S. won't repay $1 billion in convertible notes maturing June 1, according to a person with knowledge of the discussions.
President Barack Obama's auto task force told the biggest U.S. automaker it doesn't want taxpayer funds used to repay debt maturities, said the person, who declined to be identified because the talks are private. Detroit-based GM has $1 billion of 1.5 percent convertible securities coming due June 1. The debentures, issued in increments of $25, fell $2.05 to $7.20 as of 1:56 p.m. in New York, which would be the lowest closing price since December, according to data compiled by Bloomberg.
Funny, we don't remember any sort of squeamishness about "taxpayer funds used to repay debt maturities," before now. Why the sudden change in heart?
GM Said to Be Warned Government Won't Make June 1 Debt Payment [Bloomberg]