GM considering Chapter 11 that would create a new company

Posted: Feb 16, 2009
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Over the weekend, The Wall Street Journal reported that General Motors is considering Chapter 11 bankruptcy filing as an option that would create a new company. Sources familiar with the matter said that GM plans to outline the option on Tuesday when it presents its viability plan to the U.S. government.

“One plan includes a Chapter 11 filing that would assemble all of GM’s viable assets, including some U.S. brands and international operations, into a new company,” The Wall Street Journal said. “The undesirable assets would be liquidated or sold under protection of a bankruptcy court. Contracts with bondholders, unions, dealers and suppliers would also be reworked.”

Insiders say that General Motors is also considering asking the government for additional funds to keep it from going bankrupt. GM had no comment on the report.

In the mean time, GM is talking to bondholders and the UAW to reach an agreement that would wipe out about $28 billion in debt for the automaker. A deal is unlikely to be reached by Tuesday.

Source: Reuters


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  • Bobmarley

    GOOD! if they dont file chapter 11 now, they will be back asking for a bailout every other month for the next two years! This should come as no big suprise to most people that have half a clue what is going on with GM. Im suprised Obama didnt add another $100 billion to the stimulus package just for chrysler and GM.

  • Pat

    This will be a good move if the market it right because the word “bankruptcy” will send a shockwave through the already disturbed economy.

  • Rick Wag

    They should file for chapter 13 and start over. The legacy costs and union contracts are too damn expensive. Why should taxpayers have to subsidize these costs?

  • jane

    good, now only if there's a way to pay back that 18 bill bailout?…ohh f uck….tax payer's are screwed.

  • Bobmarley

    GOOD! if they dont file chapter 11 now, they will be back asking for a bailout every other month for the next two years! This should come as no big suprise to most people that have half a clue what is going on with GM. Im suprised Obama didnt add another $100 billion to the stimulus package just for chrysler and GM.

  • Pat

    This will be a good move if the market it right because the word “bankruptcy” will send a shockwave through the already disturbed economy.

  • Rick Wag

    They should file for chapter 13 and start over. The legacy costs and union contracts are too damn expensive. Why should taxpayers have to subsidize these costs?

  • jane

    good, now only if there's a way to pay back that 18 bill bailout?…ohh f uck….tax payer's are screwed.