Community-Organizer-in-Chief Gathering "Grassroots" Health Care Parties | Main | Federal Court Challenge To Proposition 8 Filed By...Ted Olson?
May 26, 2009

Government Motors...US May Take Huge Stake In New GM

I honestly never thought I'd see this in my life time.

With the United Auto Workers agreeing Tuesday to take a much smaller stake in GM than originally expected, the automaker has about 19 percent of its equity with which it could potentially sweeten the pot for bondholders. But the Treasury is reportedly planning to fork over as much as $50 billion in debtor-in-possession financing to help the cash-bleeding company through its restructuring, The Wall Street Journal said late Tuesday. In return, the government could demand up to 70 percent of GM's equity, the paper said, citing people familiar with the matter.

All of this is still being negotiated and bond holders aren't happy with the proposed debt for equity swap, so this process is a long way from done.

GM says it needs 90% of bondholders (who unlike in the case of Chrysler are unsecured) to approve the plan and avoid going Chapter 11.

"It's nowhere near 90 percent," said Kip Penniman, analyst for KDP Investment Advisors. "If GM announced they got low single-digit participation, it would be a slap to GM and the absolute response to the Treasury-mandated offer. ... A cynical person would say that the offer was set up to ensure GM would go into Chapter 11 and provide the government a scapegoat."

Always have an enemy to blame, it's the Obama way.

Frighteningly related...Gabe blogged earlier about possible political considerations in the Chrysler dealership closings. Well, here's more, including a Chrysler dealer on FNC who says he's in 'the upper 2% of dealers' and is being closed. (via Slublog's Twitter feed)

digg this
posted by DrewM. at 09:16 PM

| Access Comments

Recent Comments
redc1c4 [/b] [/i] [/s] [/u]: "Best barter materials: Liquor Little blue pills ..."

Weaning is hard: "I have a tennis friend who is the rep for PMC ammo ..."

NZFrank with a M2: "609 Posted by: NZFrank with a M2 at September 20, ..."

Martini Farmer: "> I bet you don't see many moving vans going from ..."

Anna Puma: "Yeah the Roswell Grays are really into probing...G ..."

Quint: "I bet you don't see many moving vans going from WV ..."

Tom Servo: "I believe back then the moving companies would tak ..."

whig: "Btw, at septemb, One, you can pull the bullets an ..."

irright: "My biggest problem with barter scenarios? (WHATEVE ..."

Jewells45: "Run NaCly! Run!!! ..."

Weasel: "Posted by: NZFrank with a M2 at September 20, 2020 ..."

Diogenes : "So apparently the Emmy's are tonight? Anot ..."

Recent Entries

Polls! Polls! Polls!
Frequently Asked Questions
The (Almost) Complete Paul Anka Integrity Kick
Top Top Tens
Greatest Hitjobs

The Ace of Spades HQ Sex-for-Money Skankathon
A D&D Guide to the Democratic Candidates
Margaret Cho: Just Not Funny
More Margaret Cho Abuse
Margaret Cho: Still Not Funny
Iraqi Prisoner Claims He Was Raped... By Woman
Wonkette Announces "Morning Zoo" Format
John Kerry's "Plan" Causes Surrender of Moqtada al-Sadr's Militia
World Muslim Leaders Apologize for Nick Berg's Beheading
Michael Moore Goes on Lunchtime Manhattan Death-Spree
Milestone: Oliver Willis Posts 400th "Fake News Article" Referencing Britney Spears
Liberal Economists Rue a "New Decade of Greed"
Artificial Insouciance: Maureen Dowd's Word Processor Revolts Against Her Numbing Imbecility
Intelligence Officials Eye Blogs for Tips
They Done Found Us Out, Cletus: Intrepid Internet Detective Figures Out Our Master Plan
Shock: Josh Marshall Almost Mentions Sarin Discovery in Iraq
Leather-Clad Biker Freaks Terrorize Australian Town
When Clinton Was President, Torture Was Cool
What Wonkette Means When She Explains What Tina Brown Means
Wonkette's Stand-Up Act
Wankette HQ Gay-Rumors Du Jour
Here's What's Bugging Me: Goose and Slider
My Own Micah Wright Style Confession of Dishonesty
Outraged "Conservatives" React to the FMA
An On-Line Impression of Dennis Miller Having Sex with a Kodiak Bear
The Story the Rightwing Media Refuses to Report!
Our Lunch with David "Glengarry Glen Ross" Mamet
The House of Love: Paul Krugman
A Michael Moore Mystery (TM)
The Dowd-O-Matic!
Liberal Consistency and Other Myths
Kepler's Laws of Liberal Media Bias
John Kerry-- The Splunge! Candidate
"Divisive" Politics & "Attacks on Patriotism" (very long)
The Donkey ("The Raven" parody)
Powered by
Movable Type 2.64