Posted on 04/27/2009 5:42:18 PM PDT by tobyhill
A committee of General Motors Corp bondholders representing more than $27 billion of GM debt on Monday called the automaker's debt-exchange offer politically motivated and legally risky, and said it had a small chance to succeed in a way that would avoid bankruptcy.
"We are deeply concerned with today's decision by GM and the auto task force to offer only a small, inequitable percentage of stock to its bondholders in exchange for their bonds," the bondholders said in a statement.
GM said earlier it would offer bondholders new shares in an attempt to cut 90 percent of its bond debt as part of a deeper restructuring.
The terms of the deal as dictated by the Obama administration's autos task force would give bondholders only a 10 percent stake in a restructured GM while reserving an almost 40 percent for the United Auto Workers.
(Excerpt) Read more at uk.reuters.com ...
To continue the automotive motif -
“Bend over, I’ll drive.”
They will do what they did with Chrysler. Let the UAW own 55% of GM.
Autoworkers are the stupidest, laziest people in the USA. So, Obama gives them ownership of critical businesses.
Obama is transforming us into Cuba.
so go from a relatively senior position to equity, taking whatever seniority you have and flush it (now that it is worth much...)
>> give bondholders only a 10 percent stake in a restructured GM while reserving an almost 40 percent for the United Auto Workers
Frankly, if I was a bondholder I’d be out for blood. Screw the UAW! They’re at least half the problem.
Reverse the percentages; that might be about right.
Even more scary:
“US taxpayers would take a majority shareholding in General Motors under a sweeping debt-for-equity restructuring proposal that the carmaker revealed on Monday in a bid to avoid bankruptcy.”
http://www.ft.com/cms/s/0/a5326d50-332a-11de-9316-00144feabdc0.html
Obama is not handing over the company to the auto workers. He's handing it over to the union bosses.
If I were a bondholder, I think I’d have a class-action lawsuit begging to be filed.
>> GM would be owned by the unions and the Government.
Diehard GM fans say “I’d rather push a Chevy than drive a Ford!”
If this comes to pass, this will become reality. Between government and the UAW, quality will deteriorate to where pushing is exactly how you’ll get that Chevy you just bought home from the showroom.
From Kudlow:
Get this: The GM bondholders own $27 billion and they’re getting 10 percent of the common stock in an expected exchange. And the UAW owns $10 billion of the bonds and they’re getting 40 percent of the stock. Huh? Did I miss something here? And Uncle Sam will have a controlling share of the stock with something close to 50 percent ownership. And no bankruptcy judge.
http://corner.nationalreview.com/post/?q=N2U2YTYyZTdhODc4NTEzMjcyYWJmNWExYzcwYTlmNmM=
>> If I were a bondholder, I think I’d have a class-action lawsuit begging to be filed.
Unless there’s a sneaky clause in the paperwork that short circuits it. Which wouldn’t surprise me.
I’m curious why shareholders in financial institutions — especially BAC — haven’t already filed lawsuits up the wazoo. Maybe they have and I just haven’t noticed.
Taxpayers won’t see a single dime in returns, even if GM was miraculously turned around to show a profit. This is just taxpayer’s funding of the UAW.
I know he is getting advice from Castro on the economy. His buddy Fidel is very happy to see the USA go Commie before he dies. How will they force us to buy these commiemobiles.
Ve haf vays, comrade!
Bondholders are not as dumb as stockholders. They’re mature and savvy. Obama and the UAW are going to pull this off without paying the bondholders out.
Why are they trying to avoid bankruptcy in the first place?
This deal is just a slow expensive and painful death.
The only chance GM has is to go to the courts in bankruptcy.
Since the taxpayers are being involved by Obama, we should call on GM to “Just say no to O.”
these bondholders want bankruptcy cuz they got credit default swaps on gm. trust me they will bk and so will chrysler
You're exactly right and they appear to have their insurance through AIG who in turn has our money. The bondholders aren't going to be going down with this ship.
ON TO COURT, secured bondholders!
Put the iron in the glove.
They should have gone to bankruptcy 8 months ago and save the taxpayers billions.
I Know Nothink!
Who in their right mind would buy GM bonds? Maybe you’d get some as part of a divorce proceeding but...who would buy them?
Ah yes. Fascism is just grand for the President and crap for the proletariat.
If nobody has figured this out yet, Hussein and his merry men are determined to straight jacket Wall Street so much that you'd be lucky to earn 2%-3% a year. With the Street returning so little they are pinning their hopes you'll invest in government bonds and the new and improved government sponsored 401k that I'm sure is just around the corner.
GM & Tax Cheat Tim think the bondholders are stupid! I don't think the bondholders appreciate it very much either from their reaction!
No, GM is not trying to sucker the bondholders, as it’s the Feds setting the terms.
The Feds are suckering us, because the bondholders will never go along with something like this. They’ll do much better in bankruptcy, which is where GM is headed.
Why take 10 cents on the dollar when Bankruptcy court would give you more. F__k the government
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