Posted on 05/28/2009 7:35:46 AM PDT by Abathar
General Motors Corp. said a committee of bondholders has agreed to a sweetened deal to erase some of the automaker's debt in exchange for company stock.
The company said in a statement Thursday that it offered bondholders 10 percent of the company's stock with warrants to buy up to 15 percent if they agree to support selling the company's assets to a new company under bankruptcy court protection.
The company made the disclosure in a filing with the U.S. Securities and Exchange Commission.
The filing says if the bondholders didn't agree to support the sale, then the amount of stock and warrants they get would be reduced or eliminated.
Stocks were up sharply Thursday morning amid the reports. Trading in GM shares was halted.
Wall Street is also advancing as readings on jobless claims and big-ticket manufactured goods suggest the economy is stabilizing.
In the first minutes of trading, the Dow Jones industrial average is up 65 at 8,361. The Standard & Poor's 500 index is up 7 at 900, while the Nasdaq composite index is up 15 at 1,747.
Plant Closures Expected
The troubled auto giant also is expected to identify 14 factories it will close by the end of 2010 as part of its restructuring plan, according to a person briefed on the plans.
The announcement could come by Monday, the source told The Associated Press.
Factory-level union leaders have not yet been told which plants will be shuttered, but four vehicle assembly plants will be among those to be closed, along with parts stamping, engine and transmission factories, said the person, who asked not to be identified because the plans have not been made public.
GM has said it plans to close 16 more U.S. factories by the end of next year, shedding 21,000 jobs.
(Excerpt) Read more at theindychannel.com ...
Why should those greedy speculators get anything?
Any equity that isn’t being given to the Union is simply being robbed from its rightful owners.
The sad thing is if you have ever been in a UAW hall many people think that exact way.
“The filing says if the bondholders didn’t agree to support the sale, then the amount of stock and warrants they get would be reduced or eliminated.”
Pffftt! Nice negotiation tactic backed by the US....oops, I mean Obama Government. Legalized theft and blackmail. Nice.
I hear they had to cut their palms and sign the contract with a bloody palm print...
Lifetime BEST 2 cars I ever owned....1979 Chevy Monte Carlo, 1988 Pontiac Fiero (still in driveway)! On a lark a week or so ago bought a few hundred shares of BGM (Sr Notes 7.3%)...up 25% today. Might have to buy a Bud and celebrate!
My first new car was an ‘85 SS Monte Carlo, totaled it and got an ‘87 replacement. Never had a single issue under warranty or out with either car, I loved them.
Who are those bondholders?
And what about the rest of 'em?
I guess it is being kept hush-hush until they “sign” the thing, then we will know how big a screwing the little guy will get.
Don’t matter at this point.
As a consumer, you can best be assured, I nor my familiy will ever buy GM products again.
Nor will we, and to be honest both GM and Chrysler were our bread and butter for decades from tier two suppliers whom we built tooling and molds for, Ford was number three for us.
I neither like nor dislike Ford vehicles particularly, but rest assured when any of our family need a new vehicle from now on our shadows will darken their door first.
pretty sure that's just a logistics thing....can't call everybody in the phone book! GM bondholders number in the millions...
Never say ‘nor ever’
From what I saw yesterday on Fox business channel it is not a done deal. They interviewed various bond holders who claimed not to know of any such binding arrangement
As I implied earlier....started out as a ‘Ford family’...last car was a 1976 Pinto Wagon. Pretty sure the phrase ‘never again’ came up in 1976 more than once! To be honest it was one of the ‘better’ cars I ever owned (towed a Catalina 22 to Florida with it)...never a warranty problem, one of the best engines ever...2.3 four cylinder. Easiest to work on ‘new generation’ (Post EPA) ever in my family...then switched to GM (’79 Monte Carlo), then Chrysler (84 Dodge Caravan).....all , repeat ALL best of breed, all 100,000+ milers! It’s easy to be ‘pro-Detroit’ if you don’t buy lemons!
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.