Chrysler Bankruptcy?
January 2nd, 2010 | by admin |
Ernie Fitzpatrick asked:
The headline should read that so and so corporation declares bankruptcy. However, as we move more into a SOCIALISTIC state under the Obama administration, put there in part by the Bush years, the headline reads…. U.S. Is Said to Prepare Filing for Chrysler Bankruptcy. The United States government, that now owns or has it’s fingers into more places than you can count, is the one preparing Chrysler for bankruptcy!!
Have things changed quickly, like over night, or what?
Can General Motors be too far behind? The general thinking is that GM will declare bankruptcy some time in May after we see how the Chrysler bankruptcy fares. How can any bankruptcy fare? It’s a disaster for workers, creditors, pension plans, and the economy in general.
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.
At least it will be good for a bunch of attorneys!
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.
If no agreement is reached between the government and Chrysler’s lenders, a nasty legal fight could emerge in bankruptcy. The creditors’ claims are backed by most of the company’s collateral, including plants, brands and equipment, and the senior lenders will argue that they have first claim on those assets — even over and above the government’s debt.
No matter how you slice this deal or how you spin it, the REALITIES coming froth from such action will have long term negatives.
Outdoor Bamboo Fountain
The headline should read that so and so corporation declares bankruptcy. However, as we move more into a SOCIALISTIC state under the Obama administration, put there in part by the Bush years, the headline reads…. U.S. Is Said to Prepare Filing for Chrysler Bankruptcy. The United States government, that now owns or has it’s fingers into more places than you can count, is the one preparing Chrysler for bankruptcy!!
Have things changed quickly, like over night, or what?
Can General Motors be too far behind? The general thinking is that GM will declare bankruptcy some time in May after we see how the Chrysler bankruptcy fares. How can any bankruptcy fare? It’s a disaster for workers, creditors, pension plans, and the economy in general.
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.
At least it will be good for a bunch of attorneys!
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.
If no agreement is reached between the government and Chrysler’s lenders, a nasty legal fight could emerge in bankruptcy. The creditors’ claims are backed by most of the company’s collateral, including plants, brands and equipment, and the senior lenders will argue that they have first claim on those assets — even over and above the government’s debt.
No matter how you slice this deal or how you spin it, the REALITIES coming froth from such action will have long term negatives.
Outdoor Bamboo Fountain
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