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LookieNoNookie -> RE: GM. So sweet. (12/7/2012 3:41:11 PM)
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quote:
ORIGINAL: Yachtie
At issue is a backroom deal hatched by GM to fulfill the Obama administration’s demand for a quick bankruptcy, draining the automaker of nearly all of its cash on hand and leaving it in worse shape than it was when it collapsed in 2009.
One condition of GM’s bailout was to shore up its overseas subsidiaries. On the eve of entering bankruptcy, the company cut a $367 million “lock-up agreement” with several major hedge funds to prevent GM Canada from failing. The agreement ensured that GM could spin-off its liabilities to “old GM,” while using a multi-billion dollar bailout to create a new company.
All of that could be reversed if bankruptcy Judge Robert Gerber reopens the process and rules in favor of old GM trustees, who are suing the hedge funds at the center of the lockout agreement.
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Those liabilities, which include old GM’s debt and product liabilities that pre-date bankruptcy, are valued at $30 billion, a sum that would wipe out the company’s $34.6 billion cash reserves.
For the whole story.
A backroom deal not disclosed to the judge. Wonderful[8|]
He has expressed deep frustration with the company for failing to disclose the deal, leading some to speculate that he may overturn one of President Barack Obama’s signature achievements.
Funny thing is....most liberals and Dems think that GM has paid their bill...that the feds are "free" from their "investment".
They're still upside down by 30+ billion (hence why the feds haven't sold their shares).
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