Tuesday, May 26, 2009

GM Bondholders Not Taking Deal

Yeah, I wouldn’t take that deal either. 

General Motors has fallen far short of the bondholder support it needed for its proposed debt-for-stock offer, according to a source familiar with the matter, virtually guaranteeing that the nation’s largest automaker will be forced to file for bankruptcy court protection within the week.

The bondholders own $27 billion in corporate notes. GM (GM, Fortune 500) needed owners of 90% of those bonds to accept stock in return for the debt in order to reduce its interest expenses to a more manageable level.

GM made the offer to bondholders on April 27. The company owes the bondholders $1 billion in interest payments on June 1 - money it says it does not have.

(1) Comments
Posted by Owen at 2009 hrs
Economy

  1. Obama will do them the way he did Chrysler Bond Holders. The Law meant nothing to him on that one, so why expect anything different here.

    Posted by Billiam on May 27, 2009 at 0618 hrs


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