GM waits for judge's ruling on sale plan
NEW YORK (AP) — The judge in the General Motors Corp. bankruptcy case adjourned a three-day hearing without indicating when he will rule on the company’s plan to sell its good assets to a new company.
U.S. Judge Robert Gerber asked GM’s attorneys to submit a proposed order that would be entered if the sale were to be approved. They said they would do so by Friday night or Saturday. Gerber is expected to rule some time after that.
A lawyer for GM warned the court that the only alternative to GM’s plan would be a liquidation of the company’s assets that would have “horrific” consequences for everyone involved.
Attorney Harvey Miller said the government is committed to cutting off funding to GM of the sale is not approved by July 10. That followed testimony Wednesday from a member of President Barack Obama’s automotive task force who indicated the government has no plans to continue funding GM past next Friday if the sale is not approved by then.
GM’s government-backed plan for a quick exit from Chapter 11 protection hinges on the sale of most of its assets to a new entity, allowing the automaker to leave behind many of the costs and liabilities that have made it unprofitable. The Detroit car maker’s June 1 filing for bankruptcy protection was the fourth-largest in U.S. history.
As part of the sale plan reached with the auto task force, the U.S. government will get a 60 percent stake in the new company in exchange for what’s expected to eventually total nearly $50 billion in aid. The Canadian government, which has also contributed billions in aid, will get a 12.5 percent stake while the United Auto Workers union will take a 17.5 percent share to fund its health care obligations. Unsecured bondholders receive the remaining 10 percent.
Existing GM shareholders are expected to be wiped out.
The remaining pieces of the company, including some closed plants, will become the “Old GM” and will be liquidated.
GM hopes to emerge as a leaner company, less burdened by debt and labor costs as it faces a severe recession that has sapped car and truck sales. Automakers have continued to see sales tumble in the first half of this year.
Jul 3, 2009 at 6:43 p.m.
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Dont look for any use for this ancient building. WAY to expensive to clean up,renovate for any use. Tax write-off for "old G.M."If this is part of "new G.M." and sold,probably be razed,grounds cleaned,then sold back to city.These politicos who "fought" for new product were only looking for photo ops.They ONE and ALL knew there was no chance,they were speaking as we would like to hear.Phony one,and all.Please lets oust all incumbents 2010
Jul 3, 2009 at 2 p.m.
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I think some folks such as Starbase are just holding out for some type of miracle? I think the best chance for a mircle is to get that plant sold to someone that will use it and put our local people to work. Those high paying GM type jobs are gone for unskilled labor in our neck of the woods- even if GM did need this plant for stand by duty five years from now it would be too late for most here and those jobs would only pay a fraction of the old days.
Jul 3, 2009 at 1:50 p.m.
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starbase: What plan is that? Put all the eggs in one basket and hope to God that the bottom doesn't fall out?? Or hope they don't find themselves in a handbasket and asking where they are going??? If Ryan or the other leaders from the State had a plan, they'd of brought their A game out back last Feb. JMO, of course.
Jul 3, 2009 at 11:33 a.m.
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starbase... There's your answer ! With Ryan involved......JMO !
Jul 3, 2009 at 10:50 a.m.
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ihavealife, before you run~off at the mouth,I would suggest you call your Congressman or one of the others dealing with this. They do have a plan in motion. FYI
Thank you
Have a nice day
Jul 3, 2009 at 10:12 a.m.
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It's impossible to say from this wire story. A number of facilities that will be liquidated have been covered in their local media as part of the officially released list of "old GM" assets made public (in bankruptcy court) on Tuesday. For example, the NUMMI plant (joint venture with Toyota, built Corollas and Prizms, now Vibes) is definitely on that list.
http://www.ktvu.com/news/19895114/detail...
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But Janesville was given official stand-by status, and there has been no comparable announcement. I suppose you could say there isn't much hope for it if GM is letting go one of its newest plants, but there has been no word.
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I have a PACER (Federal courts) login, so if I get a chance I'll see if that list is in there.
Jul 3, 2009 at 10:02 a.m.
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starbase... Do you have any BETTER ideas or OPINIONS on what is ahead for us ?? I didn't think so....
Jul 3, 2009 at 9:27 a.m.
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reading the comments here you would think the people posting have all the answers.
Jul 3, 2009 at 8:40 a.m.
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It sounds like the Janesville plant is "Old GM".By the way it's worded this plant will be liquidated.Best of Luck to all GM families.There is life after....just not the same.
Jul 3, 2009 at 7:32 a.m.
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wtp- this is the perfect time for GM to unload all of these EPA clean-up sites. Dump it now and be rid of it for good.
Jul 3, 2009 at 6:56 a.m.
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I can not see this building being sold. The soil and parts of the building are so contaminated that it would cost multi millions of dollars to clean up. Even to tear it down would cost millions as the area would have to be cleaned up to satisfy the state. My personal opinion is that GM who owns the building will just let it sit their and not put any money into it. At this time GM does not have that kind of money.
Jul 3, 2009 at 5:11 a.m.
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I expect the Janesville plant will be sold too- probably best if it does so we can get some jobs here from someone else- hopefully not an an automaker.
Jul 2, 2009 at 10:44 p.m.
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WOW!
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"The remaining pieces of the company, including some closed plants, will become the “Old GM” and will be liquidated."
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Good thing Janesville isn't officially closed! Jobs if GM recovers is better that no jobs. More jobs are better than none.
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