Last night the bankruptcy court overseeing the Chrysler case rendered their decision (no real surprise) to proceed with the 363 sale of Chrysler assets:
Chrysler LLC won bankruptcy court approval to auction most of its assets by May 27 with an offer from Italy’s Fiat SpA as the lead bid in a deal that would create the world’s sixth-largest automaker. ... U.S. Bankruptcy Judge Arthur Gonzalez approved Chrysler’s auction plan at about 11 p.m. yesterday in Manhattan. He overruled an objection from a group of Chrysler’s secured lenders that the process was overly influenced by President Barack Obama’s administration and would distribute proceeds improperly because it involved a “sub rosa” or secret reorganization.
The Fiat group’s $2 billion offer for most of Chrysler’s assets will be the lead bid in an auction, which is typically required for assets sold in bankruptcy. Chrysler extended the sale process at the request of its creditors’ committee, putting the deadline for competing bids at May 20 and setting a May 27 hearing to approve the winning bid, said Corinne Ball , a lawyer for the company.
The model for GM is in place. The question for GM holders now is: is 10% of "NewCo" better than a large stake in the dead brands? The process is officially corrupt. Gonzalez bought Ball's argument that this is what happens and used Lehman (one of the greatest travesties of justice known) as an example.
Disclosure: long GM debt