Off the wire: Chrysler to go Chap 11 by next week

Just saw on the Dow Jones Newswire that some sort of agreement has been made for Chrysler to enter Chapter 11 Bankruptcy. Not sure if the deal was struck between the company and auto-task force and with the bondholders or the company/auto-task force and the UAW. More to come.

UPDATE: Just as I was to hit the post button, CNBC is now reporting the same thing. CNBC (and now updated Dow Jones Newswire) is that it is a deal between the Treasury and the UAW. It will be a prepackaged bankruptcy.

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FIAT a bust

then. On top of it, I saw another report that FIAT is going after GM "best" cars and jilted Chrysler.

This is beyond belief bad. Can you imagine what the U.S. will look like without an auto industry (if you want to call Ford an auto industry)?

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Now, Now

We Still have Tesla
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Executive compensation is inversely proportional to morality and ethics.

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Maximum jobs, not maximum profits.

prepackaged bankruptcy

Are any of the terms disclosed? How exactly they do this makes all the difference.

New York Times:

The Treasury has an agreement in principle with the United Automobile Workers union, whose members’ pensions and retiree health care benefits would be protected as a condition of the bankruptcy filing, said these people, who asked for anonymity because they were not authorized to discuss the case.

Moreover, Fiat of Italy would complete its alliance with Chrysler while the company is under bankruptcy protection.

The only major question that remains unresolved is what happens to Chrysler’s lenders, who hold $6.9 billion in company debt. The government’s most recent offer, presented Wednesday, would give the company’s lenders about 22 cents on the dollar, or $1.5 billion, and a 5 percent equity stake in a reorganized Chrysler. Earlier this week, a steering committee of the lenders proposed that they receive 65 cents on the dollar, or $4.5 billion, and a 40 percent equity stake.

So, I was wrong about Fiat and the workers aren't going to get royally screwed (we think, that would be unusual!)

Might be a way to simply get out of the incredible debt?

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So where is the bailout money going?

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Dana

Globalization is a LIE!