¡¤Progress has been made to keep Chrysler out of bankruptcy
protection.
¡¤Four banks will forgo claims to their portion of
Chrysler's 6.9-billion-dollar debt.
¡¤The Treasury needs to persuade all 46
banks and hedge funds that hold Chrysler debt to go
along.
A walking stop sign is seen in front of
the logo of Chrysler at a car dealership in New York, the United States,
April 7, 2009. The U.S. Treasury will provide a further five billion
dollars in loans to General Motors and 500 million dollars to Chrysler as
the automakers work on their viability plans, officials said Tuesday.
(Xinhua/Liu Xin)
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WASHINGTON, April 28 (Xinhua) -- Progress has been
made to keep Chrysler out of bankruptcy protection as the Treasury Department
has reached a tentative agreement with four of the troubled U.S. automaker's
major debt holders.
Under the agreement, the four banks will forgo claims
to their portion of Chrysler's 6.9-billion-dollar debt in exchange for 2 billion
dollars in cash when the deal closes, the Associated Press reported on Tuesday,
quoting two people familiar with the talks.
"We view this as a huge step forward," said one of
the people, who spoke on condition of anonymity because the agreement has not
been formally announced.
The Treasury needs to persuade all 46 banks and hedge
funds that hold Chrysler debt to go along. If not, a bankruptcy filing could
still be possible for the nation's third largest automaker, the people said.
If the remaining debt holders agree to the deal, that
leaves a partnership with Italian automaker Fiat Group SpA as the lone remaining
hurdle to Chrysler meeting a government-imposed deadline on Thursday to complete
a number of major restructuring steps and become eligible for further government
aid, according to the AP report.
Two days ago, the United Auto Workers (UAW) union
reached a deal with Chrysler that would give it a 55-percent stake in the
company and assurances over issues like health care.
The accord will help pave the way for Chrysler to
forge an alliance with Fiat before the Thursday deadline to obtain additional
rescue loan from the government.
Chrysler has been living off 4 billion dollars in
government funds since the start of the year and would likely need more to avoid
bankruptcy.
Also on Tuesday, a top Fiat executive said he was
"confident" ahead of an announcement due on Thursday on a planned alliance
between Fiat and Chrysler that could save the struggling U.S. car maker from
possible bankruptcy, according to news reports.
"We are confident but we have to wait until Thursday
and respect the decision that will be taken. Negotiations are now in the hands
of the U.S. task force, the auto working group put together by President Barack
Obama," John Elkann, the deputy head of Fiat, was quoted as saying.
The file photo taken on April 15, 2009
shows the GM logo outside the GM headquarters in Detroit, the United
States. General Motors announced restructuring plans on April 27, 2009, to
cut 23,000 U.S. jobs by 2011, drop its storied Pontiac brand and slash 40%
of its dealer network in its latest bid to stay out of
bankruptcy.(Xinhua/Gu Xinrong)
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Gallery
GM plans major revamp to get
government aid
BEIJING, April 28 -- General Motors Corp said Monday that
it will cut 21,000 factory jobs in the United States by next year, phase out its
Pontiac brand and ask the government to take company stock in exchange for half
of GM's government debt as part of a major restructuring effort needed to get
more government aid.
The struggling auto maker also said it will offer 225
shares of common stock for every US$1,000 in notes held by bondholders as part
of a debt-for-equity swap. The announcements came in a filing with the
Securities and Exchange Commission. Full story
General Motors expected to dump
Pontiac
CHICAGO, April 25 (Xinhua) -- The U.S. largest
automaker General Motors Corp. is expected to announce Monday its decision to
kill the Pontiac brand as part of a tougher restructuring plan being overseen by
the government, reports from Detroit said Saturday.
GM has started reaching out to Pontiac dealers ahead of a
public announcement about the brand's future, when the automaker likely will
also outline permanent plant closures, more job cuts and a tougher offer to
bondholders to slash the automaker's 28 billion U.S. dollars in unsecured debt.
Full story
Fiat still pursuing deal with
Chrysler
BEIJING, April 28 -- Fiat Group SpA still wants to forge
an alliance with Chrysler LLC if the United States auto maker is forced to file
Chapter 11 bankruptcy protection from creditors, a source close to the
Turin-based auto maker said Monday.
Fiat is continuing talks to reach a deal by the Thursday
deadline, the source said. Full story
Canada auto workers approve union
agreement with Chrysler
OTTAWA, April 26 (Xinhua) -- The workers of the Canadian
branch of Chrysler have voted in favor of a deal between their union and the
automaker, which would serve as a precondition for Chrysler to partner with Fiat
to avoid bankruptcy.
The deal was approved by 87 percent of those Chrysler
Canada workers who voted, the Canadian Auto Workers Union (CAW) said in a
release Sunday. Full story
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