10 Jul 2009

No court delay on sale of GM

10:02 am on 10 July 2009

A US judge has rejected a last minute request by a group of personal injury claimants to delay the sale of the profitable parts of General Motors.

The BBC reports there is now nothing to stop GM selling the best parts of the business to a government-funded "new GM".

Once that has happened, the way will be clear for the carmaker to emerge from Chapter 11 bankruptcy protection.

GM has scheduled a news conference in Detroit on Friday morning.

Judge Lewis Kaplan rejected the request for a delay from a group pursuing a product liability claim relating to the Chevy Malibu on the grounds that delaying the sale would probably lead to the liquidation of GM.

The new streamlined General Motors will be 60% owned by the US government.

It will operate the best parts of the old company, including its Chevrolet and Cadillac brands. Its European operation, Opel, is being sold.

New owners

The new company is getting $US60 billion in financing from the US Treasury in return for a 60% share.

The United Auto Workers union will have 17.5%. The government of Canada will have a 12% share and GM bondholders will own about 10% in the new company.