From the Wall Street Journal of 30 Apr 2009:
Quote:
Chrysler Chapter 11 Is Imminent
Talks between the Treasury Department and lenders aimed at keeping Chrysler LLC out of bankruptcy broke down Wednesday, making it all but certain the car maker will file for Chapter 11 protection Thursday, according to people familiar with the discussions.
Administration officials, who have been braced for a Chrysler bankruptcy filing for weeks, say all the pieces are in place to get the company through the court quickly, perhaps in a matter of weeks.
|
The administration had successfully strongarmed 70% of Chrysler's debtors to swap debt for cash. But the so many other smaller debtors (ie hedge funds) were refusing. The deal was also reported to provide Cerebus Capital with nothing. Other rumors said that Nardelli would be replaced probably by the CEO of Fiat. After all that, apparently Chrysler will instead file for bankruptcy on Thursday.
I suspect investors who had seen this coming and invested in Ford will prosper tomorrow. However, these things can often result in strange collateral damage. Thursday will be interesting.