GM Edges Closer to Bankruptcy Exit
From The New York Times:
A federal judge late on Sunday approved a plan by General Motors to sell its best assets to a new, government-backed company, a crucial step for the automaker to restructure and complete its trip through bankruptcy court.
The decision by the judge, Robert E. Gerber, of Federal Bankruptcy Court in Manhattan, came after three days of hearings to address the 850 objections to the restructuring plan and after he received a revised sale order from G.M.’s lawyers.
In his 95-page opinion, Judge Gerber wrote that he agreed with G.M.’s main contention: that the asset sale was needed to preserve its business, in the face of steep losses and government financing that is slated to run out by the end of the week.
“Bankruptcy courts have the power to authorize sales of assets at a time when there still is value to preserve — to prevent the death of the patient on the operating table,” Judge Gerber wrote.
GM plans to finalize the sale, which is being financed by the government, by Tuesday. Creditors might still file an appeal, but with so much at stake and the government so entwined in the situation, the objections will more than likely fall on deaf ears.
