GM holding crisis talks

Time 13 years ago

gm crisis talksGM 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.

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