General Motors CEO Fritz Henderson told U.S. bankruptcy court today that if GM can’t sell its ‘good assets’ to a government supported ‘New GM’ by July 10, it will lose access to government funding and would be forced to liquidate.
Henderson said that “business is doing better” as customers, suppliers and workers anticipate the completion of a successful deal for the company to become the ‘New GM.’
If a deal is approved, GM will sell its best assets, including its four-core brands (Buick, Chevrolet, Cadillac and GMC) under Section 363 of the bankruptcy code while the U.S. Treasury would provide billions of dollars in financing.
Sources say that the GM sale hearing could continue for at least two days as the company faces numerous objections from the creditors committee and a group of bondholders.
Under the plan, the UAW would gain a 17.5 percent stake in the ‘New GM,’ the Canadian government will get about 12 percent and GM bondholders will get about 10 percent.
Separately, Henderson also discussed the firing of former CEO Rick Wagoner. He said that Wagoner told him that he had been asked to step down by Steve Rattner, head of Obama’s auto task force.
– By: Omar Rana