GM emerges from bankruptcy
New government-backed company gives troubled US car manufacturer a “second chance”.
“We recognise that we’ve been given a rare second chance at GM, and we are very grateful for that. And we appreciate the fact that we now have the tools to get the job done.”
Jobs slashed
GM has slashed its work force, closed 40 per cent of its dealerships and shed a number of brands including Saab, Saturn, Opel and Hummer.
It will cut 6,000 jobs by October in a move that will reduce its white-collar work force by 20 per cent and a 35 per cent reduction in executive posts is also planned.
The US government has provided about $50bn in financing for the company and spearheaded the restructuring plan.
Canada, which provided more than $9bn in loans, also has a stake in the new GM along with a United Auto Workers union retiree healthcare trust fund.
The new firm has also been freed of $173bn of liabilities it had when it entered bankruptcy protection on June 1.
Creditors holding about 54 per cent of GM bonds agreed to a plan that would swap $27bn dollars in debt for a 10 per cent stake and warrants allowing them to buy an additional 15 per cent stake.