GM looking to Congress for help in buying Chrysler

Cash hungry GM may go to Congress for some extra needed cash to move towards a possible acquisition of Chrysler LLC. According to a person familiar with the financial side of the deal, said that GM is looking to go as the government to help it purchase Chrysler although he is not sure if the General had approached the government as of yet.

Chrysler reportedly has about $11 billion available that GM can tap into. However, that may not be enough for GM to purchase Chrysler, which is losing money, unless Congress jumps in on the negotiations. According to insiders, without additional money, GM may be unwilling to buy Chrysler from 80.1 percent share holder Cerberus.

Why would Congress like to help? Analysts say that Congress may be forced to take on pension costs for Chrysler if the company goes bankrupt. Not only that, Congress may want to help preserve as many as 49,000 Chrysler U.S. jobs.

An official word on the deal is expected by the end of this month.


Source: MSNBC