Posted on 04/23/2009 12:48:06 PM PDT by MaestroLC
DETROIT — The Treasury Department is preparing a Chapter 11 bankruptcy filing for Chrysler that could come as soon as next week, people with direct knowledge of the action said Thursday.
The Treasury has an agreement in principle with the United Automobile Workers union, whose members’ pensions and retiree health care benefits would be protected as a condition of the bankruptcy filing, said these people, who asked for anonymity because they were not authorized to discuss the case.
Moreover, Fiat of Italy would complete its alliance with Chrysler while the company is under bankruptcy protection.
The only major question that remains unresolved is what happens to Chrysler’s lenders, who hold $6.9 billion in company debt. The government’s most recent offer, presented Wednesday, would give the company’s lenders about 22 cents on the dollar, or $1.5 billion, and a 5 percent equity stake in a reorganized Chrysler. Earlier this week, a steering committee of the lenders proposed that they receive 65 cents on the dollar, or $4.5 billion, and a 40 percent equity stake.
Officials at Chrysler and the Treasury were not immediately available for comment.
A bankruptcy filing by Chrysler would be the first among Detroit’s troubled automakers, who have been mired in a devastating sales slump since last fall. Treasury is also working with General Motors to prepare a possible bankruptcy case, and the terms of a Chrysler filing might offer a glimpse into the shape of G.M.’s own filing.
Some analysts questioned whether the Treasury’s steps to prepare a bankruptcy case were an effort to put more pressure on lenders, with which it has exchanged proposals meant to reduce Chrysler’s debt. Chrysler faces an April 30 deadline from the Treasury, while G.M. faces a June 1 deadline in its own efforts to draft a new restructuring plan.
(Excerpt) Read more at nytimes.com ...
Words fail me... Treasury - the GOSHDARN MOTHER-PUSS-BUCKET SUMNABATCH GOVERNMENT - is custom designing bankruptcy for a freaking company?!?
Fiat will buy/take over Chrysler.
Maybe you have a link to it since you read it!!
I’m thinking this also. We bail out all sorts of companies-banks, autos, suppliers...but still people are getting laid off.
This smells very stinky...it should be called the UAW Pay for Play, the Chitown Way. And where does the US Treasury find that $5 BILLION to dump into the UAW Pension Funds, oh right from the US Taxpayers who have refused to buy the crappy Chrysler products produced by the UAW thieves.
The UAW parasites have finally killed their host and are now latching on to the US taxpayer.
LQ
Your questions make no sense. Obama is Chrysler, the new, improved, neosocialist Chrysler, so he doesn't have to discuss it with anyone else. Didn't you learn about the efficiency of national socialism when you studied history?
As for discussing this with the American people, he doesn't need to. He won. Obama and Pelosi tell us what we will do, and our place is to obey, not to question our betters. I think maybe you need a bit of re-education.
How'd I do? Am I ready for a leadership post in Obama's civilian forces?
Perhaps they can slice off thick slabs of UAW fat from the business plan.
And now there will be the bailed out and those that paid for the bail-outs and then lost their jobs.
Not good for American civility if you ask me…
This pre-packaged bankruptcy is just this side of fascism. When the government reaches their hand into the wallets of taxpayers to subsidies a company (only because that company employs a massive DNC lobby), it's fascism.
And the taxpayer payeth and then payeth some more and so goes their children and grandchildren if we still have a country by then...
Bush? Carter should have let it go down the drain in 1977.
I have a dime.
They will be back at the trough again.
I was just reading details...half the legacy will be stock given to union and the other half will come from Chrysler profits or from government...it was on HuffPO.
My husband works for GM as some of you know...the plant is horrible right now...people who are getting laid off vs those who are not, some forcing out of the plus 40 crowd and younger workers vs older workers...it’s not pretty and that’s one plant.
Protect by who, the Taxpayer? Wonder if the bankruptcy judge could nullify this "agreement in principle" anyway.
If the taxpayer is on the hook any further just to support the UAW, there should be a nationwide tax revolt.
UAW = AIG
Chrysler was in deep do do way before obama was even nominated. As another poster mentioned they should have declared bankruptcy last year.
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