Welcome to the North American Subaru Impreza Owners Club Friday August 18, 2017
Home Forums WikiNASIOC Products Store Modifications Upgrade Garage
Go Back   NASIOC > NASIOC General > News & Rumors > Non-Subaru News & Rumors

Welcome to NASIOC - The world's largest online community for Subaru enthusiasts!
Welcome to the NASIOC.com Subaru forum.

You are currently viewing our forum as a guest, which gives you limited access to view most discussions and access our other features. By joining our community, free of charge, you will have access to post topics, communicate privately with other members (PM), respond to polls, upload content and access many other special features. Registration is free, fast and simple, so please join our community today!

If you have any problems with the registration process or your account login, please contact us.
* Registered users of the site do not see these ads. 
Thread Tools Display Modes
Prev Previous Post   Next Post Next
Old 04-27-2009, 01:10 PM   #1
Scooby Guru
Member#: 73805
Join Date: Nov 2004
Location: NEPA
2017 911 Turbo
Miami Blue

Default U.S Treasury to Nationalize GM: American Leyland Is Born

U.S. May Take Stake in GM to Pay Off Loans

Faster Cuts and More Loans Are Key to G.M. Survival Plan

General Motors said on Monday that it needed $11.6 billion more in government loans and that it planned to file for bankruptcy protection if a debt exchange with its bondholders was unsuccessfulG.M. also said that, by 2010, it would phase out its Pontiac brand, eliminate 42 percent of its dealers, close 13 plants and cut 21,000 hourly jobs as part of its revised restructuring plan.

“We need to have a more stable and sustainable business model, because, candidly, we only want to do this once,” G.M.’s chief executive, Fritz Henderson, said at a news conference. “We don’t think that what’s being asked of us is too hard. Our objective here is to create a strategy where we can win, not simply survive.”

G.M. shares rose 25 percent in morning trading on the New York Stock Exchange after the plan was announced.
The cuts outlined on Monday are considerably greater and scheduled to occur sooner than G.M. had outlined in its February restructuring plan. The plan would result in the federal government becoming G.M.’s majority owner.

Since December, G.M. has borrowed $15.4 billion to keep it out of bankruptcy while it tries to restructure. The new request would bring that figure to $27 billion. The company originally said it needed between $22.5 billion and $30 billion to remain solvent.

In the plans announced on Monday, G.M. wants to persuade 2,641 of its 6,246 independently owned dealerships — 500 more than it previously announced — to close four years sooner than it had intended.

By the end of next year, it plans to employ 40,000 hourly workers at 34 plants, down from 61,000 workers at 47 plants. That is at least 7,000 more job cuts and one more plant closure than the February plan called for. An additional 2,000 jobs would be cut in 2011.

G.M. said the additional actions would allow it to break even at industry sales volumes as low as 10 million a year. Sales this year are expected to be slightly higher than that figure.
In addition, the company said it would give bondholders 225 shares, worth $414 as of Friday, for every $1,000 that they hold.

It urged the bondholders, who hold more than $27 billion in G.M. debt, to accept the deal to allow a faster out-of-court restructuring and said their bonds could be worth less or nothing in a bankruptcy filing.

G.M. said the holders of at least 90 percent of its outstanding bonds must agree to the swap by May 26 for the company to avoid bankruptcy.

“We do not intend to seek relief under the U.S. Bankruptcy Code if the exchange offers are consummated,” G.M. said in a regulatory filing.

By exchanging stock for its bonds and by converting its debt to the Treasury Department and to a retiree health care fund for the United Automobile Workers union, G.M. said it can eliminate $44 billion in debt. The Treasury and the U.A.W.
would own up to 89 percent of the company’s outstanding shares, while bondholders would hold no more than 10 percent and current shareholders would hold 1 percent.

The Treasury would own more than half of G.M. on its own and therefore have control over the election of its board and other matters requiring the approval of shareholders.

In a bankruptcy, G.M. said it might separate itself into two companies: a new G.M. composed of desirable assets like the Chevrolet and Cadillac brands, and a collection of its unwanted assets that would then be liquidated.

G.M. has been negotiating with an ad-hoc committee representing large bondholders, but the two sides have been unable to reach a deal. The bondholders committee says G.M. has not been responsive to its requests in more than a month.

The Obama administration’s autos task force gave the automaker until June 1 to develop a more aggressive turnaround plan and to reach deals with its bondholders and the United Automobile Workers union. Talks with the U.A.W., which announced a cost-cutting deal with Chrysler on Sunday, are continuing.

Last edited by AVANTI R5; 04-27-2009 at 01:43 PM.
AVANTI R5 is offline   Reply With Quote

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Forum Jump

Similar Threads
Thread Thread Starter Forum Replies Last Post
This video is one of the reasons I'm proud to be an American I25 Off-Topic 130 02-27-2011 05:40 PM
Room mate just d/l'd American Gangster, is it good enough to stay up late watching? Clarkson.is.God Off-Topic 25 01-16-2008 01:33 PM
The only reason to watch American Idol is on tonight... The Tree Off-Topic 64 01-26-2006 09:33 PM
American Citizens finally try to stop ileagal aliens / Where is the Bush and Cheney? unkadave Political Playground 7 04-07-2005 01:27 AM
Treasury to change the color of money 2WDrift Off-Topic 9 03-06-2004 12:34 AM

All times are GMT -4. The time now is 01:26 PM.

Powered by vBulletin® Version 3.7.0
Copyright ©2000 - 2017, Jelsoft Enterprises Ltd.
Powered by Searchlight © 2017 Axivo Inc.
Copyright ©1999 - 2017, North American Subaru Impreza Owners Club, Inc.