CORRECTED - UPDATE 1-GM bankruptcy plan eyes quick sale to gov't | Deals | Mergers & Acquisitions | Reuters

CORRECTED - UPDATE 1-GM bankruptcy plan eyes quick sale to gov't | Deals | Mergers & Acquisitions | Reuters: "NEW YORK, May 19 (Reuters) - General Motors Corp's (GM.N) 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.

GM has about $6 billion in secured debt, including a secured revolving credit and bank debt.

The government's plans include giving stakes in the new company to GM's union and bondholders, although the ownership structure of the company is still being negotiated, said the source who is familiar with the company's plans.

In addition, the government would extend a credit line to the new company and forgive the bulk of the $15.4 billion in emergency loans that the U.S. has already provided to GM, the source said.

The government has given GM until June 1 to restructure its operations to lower its debt burden and employee costs.

If those talks failed, the company has said it would follow rival Chrysler LLC into bankruptcy.

Setting up a new company to buy the healthy assets is aimed at reassuring consumers who might not be willing to make a major purchase from a bankrupt company, fearing it would not honor warranties or provide service.

The board of the new company would be established with the tacit approval of the government. Fritz Henderson, who took the helm of GM earlier this year after the government pushed out Rick Wagoner, would likely head the new company, the source said.

GM could not be immediately reached for comment.

GM shares were up about 9 percent at $1.29.


Think about this. read it well
GM is now selling to a front company that was owned by the US Government.
Who gets stakes in the new company?
The stock holders who made the company and were owed for their investments you say .. NO
The UNION gets the company.

What about the money that we the people already paid into keeping GM alive so the Union would have a place to work? FUGETABBUDUIT!
The government doesn't care .. it is only $15.4 BILLION in emergency funds ...

CAN WE THE PEOPLE BE SCREWED ANYMORE?

Obama was all about going after big companies, now he just gives it all to big UNIONS.
Why .. because UNIONS VOTE DEMOCRATIC!

There goes more taxes down the drain, but it is good for Obama's political future you know so it is okay .......... NOT!

Wake up American's .. your children just bought and paid for this company TWICE!