Monday, June 08, 2009

Chrysler Sale to Fiat hits Bump

And her name is Ruth Ginsberg, of all people.
The Automotive News - "The U.S. Supreme Court will delay the sale of Chrysler LLC's assets to a new automaker run by Italy's Fiat S.p.A. while the court reviews the constitutionality of the bankruptcy sale. The court agreed today to consider the case after Justice Ruth Bader Ginsburg reviewed a petition to the top court by three Indiana pension funds."

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cheese said...

Don't kid yourself, they are just giving the robbers time to fleece the corpse before it's buried!

The Pharisee said...

If SCOTUS sustains the bondholder complaint, which technically, it should, then Chrysler will be a corpse.

What's fascinating is that the bondholders will end up getting less, than they are now. The bondholders that are complaining are going to loose about $14,000,000.00 which is a percentage of the bonds value, which were in fact rated as "junk bonds."

If they succeed in delaying the sale because they want to lose less money, they're going to lose nearly all of it. They'll wish they could go back and get the deal where they were going to lose $14,000,000.00.

The Pharisee said...

A thought to add to my preceding comment. There are a lot of things wrong with the "fast track" bankruptcies of both Chrysler and GM, not the least of which seems to be the growing stink of long term planning, namely, this was foreseen a while back by some, and planned for, long before Obama arrived on the scene.

Doubtless if this is the case, there has been some profiteering going on at the expense of secured creditors. That's disturbing. If this deal is stopped, GM will probably fall and fail, and so will Chrysler. On the one hand, good riddance, on the other, will the cure be worse than the disease? It's truly hard to say.

It also bothers me that regardless of the right or wrong questions there are people on the sidelines that seem to be salivating over the prospect of watching this corporations blow up and die. That to me is weird since everyone will lose in that scenario. It's almost as if people in the stern section of the Titanic are cheering because the Captain died first, since he was in front.