Monday, July 13, 2009
General Motors 'exits bankruptcy'
General Motors (GM) has emerged from bankruptcy after signing a deal allowing it to sell its best assets to a "new GM", reports say.
News agencies, quoting unnamed sources, reported that the US government and GM signed the documents at 1030 GMT, ending its 40-day bankruptcy.
Official confirmation is expected when GM holds a news conference later.
The new, leaner GM will own the company's key assets such as Buick and will be 61% owned by the US government.
GM is in the process of selling off its other brands such as Hummer, Saab and its GM Europe arm, which owns Vauxhall and Opel.
GM filed for bankruptcy protection on 1 June, saying it would be forced to liquidate if the plan was not approved.
Strongly supported by President Barack Obama, GM's bankruptcy process was two days faster than crosstown rival Chrysler Group.
Smaller and leaner
A new, smaller GM is being created with a reduced workforce, smaller dealer network and less debt.
It will operate the strongest parts of the old company, with only its Chevrolet, Cadillac, Buick and GMC brands remaining.
The firm is getting $60bn (£37.3bn) in financing from the US Treasury, which gives the US government a 61% share in the new GM, while the United Auto Workers union will have 17.5%.
Canada's government will have a 12% share and GM bondholders will own about 10% in the new company.
The US government has said it does not want to be involved in the day-to-day running of GM.
DATED: 13.07.09
FEED: AW
