WORLD> America
Bankruptcy remains an option for GM, analysts say
(Agencies)
Updated: 2009-02-19 09:41

DETROIT  – A government-backed bankruptcy reorganization remains an option for saving General Motors Corp and Chrysler LLC, analysts said on Wednesday, even though the automakers have said they would rather not go down that road.


Car salesman Ray Schaffer (L) shows a customer a 2009 Chevrolet Impala sedan at a dealership in Dearborn, Michigan December 29, 2008. [Agencies] 

Related readings:
 Chinese automaker denies buying GM's Hummer
 GM, Chrysler seek more govt aid, to cut more jobs
 GM, UAW in talks racing toward Tuesday deadline
 GM's fall could help speed up restructure

GM and Chrysler asked for billions of dollars more in federal aid on Tuesday and announced sweeping changes including capacity reductions and job cuts.

Some Wall Street analysts were disappointed that the restructuring plans submitted to the US Treasury did not include key concessions from the United Auto Workers union and the automakers' bondholders.

One analyst said that taking the bankruptcy option off the table would reduce the bargaining power of the companies.

Both GM and Chrysler analyzed a possible bankruptcy filing in their restructuring plans but stressed that it was not their preferred method for reorganizing and that they hoped to avoid this scenario.

GM, which has requested $16.4 billion in additional loans from the US government for a total of up to $30 billion, has said it would run out of cash as soon as March without new federal funding.

The request came shortly after smaller rival Chrysler asked for another $5 billion in aid.

GM's request that a sizable chunk of total aid come in the form of preferred equity rather than debt is a "tacit acknowledgment of the fact that GM may emerge from an out-of-court process as a still highly levered firm," JP Morgan analyst Himanshu Patel said.

David Leiker, analyst with Robert W. Baird, still sees bankruptcy as the best option for a reorganization.

"Though likely to be painful near-term, we continue to believe that the challenges to restructuring GM and Chrysler are too complicated to be met outside of a bankruptcy," Leiker said.

In its restructuring blueprint, GM estimated that if it were forced to reorganize in a traditional bankruptcy, the tab for the government could touch $100 billion in bankruptcy financing.

Chrysler estimated that the bill for its bankruptcy could hit $1,200 per taxpayer.

GM also outlined cost-reduction actions but still has to reach an agreement with its bondholders and the UAW on how to reduce the roughly $48 billion it owes both groups.

An equity-for-debt swap, which is being considered, could significantly hit stockholders.

"A substantial majority of the pro-forma equity in General Motors would be distributed to exchanging bondholders and the UAW VEBA," Credit Suisse analyst Chris Ceraso said. "The existing equity holders would largely be wiped out by the bond and VEBA exchanges."

The UAW VEBA is trust fund set up to cover employee healthcare costs.

Another issue that could crop up for auto investors is the potential for "going concern opinions" from auditors due to the liquidity crunch, operational losses and solvency issues in the auto industry, according to Grant Thornton, a corporate advisory and restructuring services firm.

A going concern opinion is a statement that there is substantial doubt about the entity's ability to continue as a going concern, something that would be typically mentioned in US Securities and Exchange Commission filings by companies.

"It's important for the public, the supply base and all of the parties involved in restructuring the auto industry not to overreact if they start seeing 'going concern' opinions," said Kimberly Rodriguez, co-leader of Grant Thornton's global automotive team, adding that the radical restructurings GM and Chrysler are undertaking would ultimately help salvage the industry.

GM shares were down 9 cents or 4.13 percent at $2.09 in afternoon trading on the New York Stock Exchange.

主站蜘蛛池模板: 人妻av综合天堂一区| 国产成人精品实拍在线| 中文字幕伊人久久网| 欧洲最强rapper网站在线看| 亚洲色无码一区二区三区| 精品国产男人的天堂久久| 国产乱子伦一区二区三区| 国模欢欢炮交150视频| 国产精品无码无卡在线播放 | 国产中文字幕第一页| 欧美高清一区二区三| 国产精品无码免费播放| 999国产精品999久久久久久| 天天欲色成人综合网站| 一级毛片一级毛片免费毛片| 成年网址网站在线观看| 久久―日本道色综合久久| 日本精品ova樱花动漫| 久久精品无码一区二区日韩av| 欧洲vat一区二区三区| 亚洲日本国产精华液| 波多野结衣bd| 亚洲美女又黄又爽在线观看| 狠狠躁日日躁夜夜躁2022麻豆| 免费看一级做a爰片久久| 精品日韩二区三区精品视频| 国产AV无码专区亚洲AV麻豆| 色视频综合无码一区二区三区 | 日本韩国在线视频| 久久精品国产亚洲av四虎 | 99视频精品国在线视频艾草| 国产清纯91天堂在线观看| caoporn97在线视频| 国产精品久关键词| 在线a免费观看最新网站| 国产精品毛片在线完整版| 6080新觉伦| 国产精品国产精品偷麻豆 | 亚洲国产成人久久一区www| 欧美日韩国产一区三区| 亚洲婷婷综合色高清在线|