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GM Bondholders watching Chrysler Bankruptcy

By Anonymous

An update on a key court ruling tomorrow - not just for Chrysler, but probably for GM too.

From the Financial Times: GM creditors watch Chrysler lawsuit (ht jb)

General Motors bondholders ... will be watching a New York court on Tuesday as a group of Chrysler creditors tries to block the imminent emergence of GM?s smaller rival from bankruptcy protection.

GM?s offer to the bondholders of a 10 per cent equity stake in the restructured company expires at midnight. The bondholders, with $27bn in unsecured claims, are widely expected to reject the proposal, setting the stage for GM to file for bankruptcy protection by June 1.
...
The bankruptcy court is expected to approve the deal tomorrow, paving the way for the new company to emerge from Chapter 11.

So Chrysler will probably emerge from bankruptcy this week - and GM will likely file for bankruptcy by next Monday, June 1st.

Full post as published by Calculated Risk on May 25, 2009 (boomark / email).