GM Bondholders Reject Offer; Bankruptcy Now All But Certain For Automaker
General Motors announced this morning that its debt-for-equity swap offer to its bondholders deal has failed, eliminating the last procedural hurdle to a government-sponsored bankruptcy.
GM had offered its bondholders, who hold some $27 billion in company debt, an offer to swap their debt for a 10 percent stake in the company. But the bondholders understood this was merely a perfunctory offer from a company well on the road to restructuring.
Bondholders had a deadline of midnight last night to turn in their debt for their stake in GM, but resoundingly refused to participate. GM needed 90 percent of them of them to participate and the company fell well short of its deal.
Today, GM said there would be no extension to the offer or a second offer, closing the window for the bondholders.
Read The Post's David Cho, Peter Whoriskey and Kendra Marr and their account of what the bankrupt GM will look like.
Meanwhile, while everyone was focused on GM, it looks like Chrysler has made good on its promise to turn around a light-speed bankruptcy, The Post's Tomeoh Murakami Tse and Peter Whoriskey write.
May 27, 2009; 9:41 AM ET
Categories: The Ticker | Tags: GM
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