Wednesday, April 29, 2009

UAW, Fiat, and US Government Might End Up Owning Chrysler

Chrysler has reached separate deals with the UAW and its bondholders that may help the automaker avoid bankruptcy, although the White House won't rule out that outcome. But if all goes according to plan, the proposal will leave Chrysler with a radically new ownership structure:

- The UAW has agreed to effectively swap a $10 billion payment due its retiree health fund in exchange for a 55% stake in a restructured Chrysler, according to the Washington Post.
- Chrysler bondholders have agreed to take about 30 cents on the dollar for about $6.9 billion of debt obligations; in exchange, the creditors will share a 10% stake in the automaker with the U.S. government.
- Fiat will own the remaining 35% of the company.

No comments:

Post a Comment