3:29 pm, November 30, 2008
GM is holding emergency talks with its lenders this weekend over a deal to save it, reports The Sunday Times.
The maker, which owns Vauxhall, Saab, Chevrolet and Cadillac, is in negotiations over a ‘multi-billion dollar debt-for-equity deal.’
GM chief Rick Wagoner wants a deal concluded by Tuesday, for up to $12 billion (£7.8 billion) in financial aid from the US Government.
This would help reduce the company’s debt pile, which The Sunday Times says is $43 billion. Interest costs alone on this are $2.9 billion a year.
In the first 9 months of 2008, the company has lost $13 billion.
If the plan is agreed, it would be on the condition of forming a much smaller, leaner business, said the paper.
Agreement has to be reached this weekend to avoid the company seeking bankruptcy protection.
It says agreement is likely; unsecured creditors risk big losses if GM is forced into Chapter 11.
Car Dealer will follow the situation – and its implications on UK dealers – carefully.
Interestingly, too, the company has also set up a webpage, putting its case to the public. See it here for more info.
