Chrysler files for Chapter 11 bankruptcy

cathayee

David Shepardson / Detroit News Washington Bureau
Washington -- Chrysler LLC filed for bankruptcy protection Thursday afternoon and announced it has reached a partnership agreement with Italian automaker Fiat SpA.

The filing in U.S. Bankruptcy Court in New York is an effort to quickly wipe clean Chrysler's balance sheet, backed with $8 billion in U.S. government financing, in the hopes that the company will emerge in 30 to 60 days.

The White House forced the move Thursday after talks between the Treasury Department and some of the Auburn Hills automaker's creditors failed to reach an agreement.

Advertisement

"It will be efficient. It's designed to deal with those last few holdouts, and it will be controlled," President Barack Obama said in a 12-minute address from the White House. "It will not disrupt the lives of the people who work at Chrysler or live in communities that depend on it. ... I have every confidence that Chrysler will emerge from this process stronger and more competitive."

Under the plan the administration outlined Thursday, the Treasury Department will provide Chrysler with up to $3.5 billion in debtor-in-possession financing, and the Canadian and Ontario governments will provide around $800 million and get 2 percent of Chrysler's equity.

Obama confirmed Thursday that Chrysler and Turin-based Fiat reached a deal outlining the company's partnership agreement -- as well as confirming Chrysler will need a stay in bankruptcy court to erase some of its debts and liabilities and trim its dealer network.

The 24-page filing in court by Chrysler's lead law firm Jones Day was assigned to U.S. Bankruptcy Judge Arthur J. Gonzalez, who has been on the court for 14 years.

"(Bankruptcy) is the only path. It is the most viable path to make sure that Chrysler survives," Chrysler CEO Robert Nardelli told reporters on a conference call.

Chrysler filed for bankruptcy protection under Section 363(b) of Chapter 11 of the bankruptcy code -- a move that will allow it to split off the "good" assets and form a new company.

Chrysler won't terminate its pension plan or stop paying retirees health care benefits, the company said.

The government will loan GMAC LLC additional money so it can take over financing of Chrysler vehicles from Chrysler Financial. The government already has infused nearly $6 billion into GMAC. Nardelli said it will likely lead to a merger of Chrysler Financial and GMAC.

The Treasury also will provide Chrysler with $4.5 billion in exit financing. Chrysler will have a new board of directors and the government will take a role in helping to select the board. Nardelli told CNBC Thursday he would leave the company after it emerges from bankruptcy.

"Given where we were, (bankruptcy) ended up being the only solution," Nardelli said. "Not one that I would have chosen first, but a decision we had to make."

A UAW health care trust will own 55 percent of Chrysler's stock, but it will be administered by the U.S. Treasury. The U.S. government will own 8 percent.

The Treasury will appoint four members of the board; Fiat will appoint three; Canada will appoint one; and the UAW trust will appoint a member.

Fiat will start with a 20 percent stake in Chrysler and, as it meets three different milestones -- including building a 40 mpg vehicle in the United States -- it will get a total of 35 percent stake in the company.

President criticizes hedge funds
The president had harsh words for the group of investment companies and hedge funds that balked at a debt restructuring. "I do not stand with them," Obama said, calling them "speculators" who sought to endanger Chrysler's future for their own benefit.

Obama also said that Ed Montgomery, the labor expert who he appointed to oversee aid federal aid to hard-hit auto communities, will travel to Michigan again next week to meet with local officials.

A key sticking point was at least three of Chrysler's 46 lenders have refused to accept a deal to exchange a total of $6.9 billion in debt for $2 billion in cash. The Treasury Department on Wednesday raised that offer to $2.25 billion, but withdrew at 6 p.m. after some lenders rejected it.

But four major lenders holding 70 percent of the debt agreed to the deal on Tuesday -- giving Chrysler a better chance of quickly emerging from bankruptcy.

"While the administration was willing to give the holdout creditors a final opportunity to do the right thing, the agreement of all other key stakeholders ensured that no hedge fund could have a veto over Chrysler's future success," an administration official said Thursday morning. "Their failure to act in either their own economic interest or the national interest does not diminish the accomplishments made by Chrysler, Fiat and its stakeholders nor will it impede the new opportunity Chrysler now has to restructure and emerge stronger going forward."

Administration officials have said there are other liabilities that Chrysler may want to discharge in bankruptcy, including some dealer agreements and lawsuits.

The Obama administration had rejected Chrysler's Feb. 17 restructuring plan and request for $5 billion in additional aid, saying Chrysler wasn't viable as a standalone company.

Automaker avoided bankruptcy before
The iconic American automaker, which between 1936 and 1949 was the second-largest U.S. auto company, narrowly avoided bankruptcy in 1980, when it won a $1.5 billion government loan guarantee that it repaid in 1983, ahead of schedule, in part on the strength of the K-Car and the sale of its defense unit.

In 1998, it was sold for $36 billion to Daimler-Benz -- a troubled tie-up that ended in 2007, when the German automaker sold Chrysler to Cerberus Capital Management LP in a $7 billion deal.

Cerberus will relinquish all equity.

Chrysler avoided collapse last winter when the Bush administration agreed to loan the company $4 billion. In January, Chrysler Financial received a $1.5 billion loan to boost auto lending. Chrysler's sales fell 30 percent in 2008, compared with an industry decline of 18 percent. In the first three months of the year, Chrysler's sales are off 46 percent.

This marks another tie-up with a European automaker -- though at a time of sharply lower auto sales. It's still not clear how Chrysler will survive until 2011 -- when the first Fiat-inspired vehicles roll off the assembly line.

The administration had signaled for months that it thought a bankruptcy filing for Chrysler -- and for General Motors Corp. -- might be the "best option." The officials were convinced that a stay in bankruptcy could be short -- pointing to the example of the sale of most of Lehman Brothers to Barclays in just five days last year.

But the administration had to overcome fierce opposition from the UAW and Michigan members of Congress. Auto executives repeatedly warned that they feared with so many car companies to choose from, customers wouldn't buy a car from a bankrupt company. Last month, the Obama administration announced it was creating a $1.25 billion program to guarantee the warranties of GM or Chrysler vehicles if they were forced into bankruptcy and couldn't honor them.

yuting0921

who will be the next?

cathayee

it is said 30% ~ 50% auto supplier will go bankcruptcy

xiaocg2008

克莱斯勒文件第十一章破产
大卫Shepardson /底特律新闻报华盛顿分社
华盛顿-克莱斯勒有限责任公司申请破产保护星期四下午宣布，该公司已经达成了合作协议，意大利汽车制造商菲亚特公司。  

提交美国破产法院在纽约是为了迅速消灭干净克莱斯勒的资产负债表，之后与80亿美元的美国政府资助，希望该公司将出现在30至60天。  

白宫被迫搬迁星期四之间的会谈后，财政部和一些汽车制造商奥本山的债权人未能达成一个协议。  

广告

“这将是有效的。它的设计处理这些过去几年坚持，这将得到控制， ”奥巴马说，总统在12分钟的讲话，白宫。 “这不会破坏人民的生活谁在克莱斯勒工作或生活在社区，依赖于它。 ...我完全相信，克莱斯勒将摆脱这一进程更稳健和更具竞争力。 ”  

根据该计划概述的管理，星期四财政部将提供克莱斯勒高达35亿美元的债务人持有资产融资，以及加拿大和安大略政府将提供约八万点○○○万美元并获得百分之二克莱斯勒的股权。  

奥巴马日证实，克莱斯勒和都灵的菲亚特公司达成了协议，概述了该公司的合作协议-以及确认克莱斯勒将需要留在破产法庭清除一些债务和负债，并准备将其经销商网络。  

24页的文件中法院克莱斯勒导致法律公司Jones Day被分配到美国的破产法官阿瑟冈萨雷斯学者，谁一直在法院工作了14年。  

“ （破产）是唯一的道路。这是最可行的途径，以确保克莱斯勒生存” ，克莱斯勒首席执行官罗伯特纳德利记者在一个电话会议。  

克莱斯勒公司申请破产保护，根据第363 （ b ）的第11章的破产法-此举将使它分裂出去的“好”的资产，并组建一个新公司。  

克莱斯勒将不会终止其养老金计划或停止支付退休人员的医疗保健福利，该公司表示。  

政府将贷款公司GMAC的额外资金，使其能够接管融资克莱斯勒汽车克莱斯勒金融。政府已注入近60亿美元到通用。纳德利表示，将可能导致合并克莱斯勒金融和通用汽车。  

美国财政部也将提供与克莱斯勒45亿美元的出口融资。克莱斯勒将有一个新的董事会和政府将采取的作用，帮助选择董事会。纳德利告诉CNBC星期四，他将离开该公司后，摆脱破产。  

“由于我们是， （破产）的股票上涨的唯一解决办法， ”纳德利说。 “没有一个人，我会选择第一个，但我们已决定作出。 ”  

阿工会保健信托将持有百分之五十五克莱斯勒的股价，但将管理美国财政部。美国政府将自己的百分之八。  

美国财政部将任命4名董事会成员;菲亚特集团将任命三名;加拿大将任命一名;和UAW的信任将任命一名成员。  

菲亚特公司将开始以百分之二十的股份，克莱斯勒和，因为它符合三种不同的里程碑-包括建设一个40英里的车辆在美国-它只能提供一共有百分之三十五的股份。  

总统批评对冲基金
总统措辞严厉的集团投资公司和对冲基金是不愿意进行债务重组。 “我不与他们站在一起， ”奥巴马说，这些问题是“投机者”是谁试图危及克莱斯勒的未来为自己的利益。  

奥巴马还表示，埃德蒙哥马利，劳动专家谁，他获委任为监督援助联邦援助受灾严重的汽车社区，将前往密歇根州下周再次会晤当地官员。  

一个关键的症结是至少有三个克莱斯勒的46个银行已拒绝接受处理，交流，共69亿美元债务为20亿美元的现金。美国财政部周三提出，提供22.5亿美元，但在下午6时后，一些银行拒绝了这一要求。  

但是，四大银行控股百分之七十的债务同意该交易日-让克莱斯勒有更好的机会迅速脱离破产保护。  

“虽然政府愿意给予抵抗债权人的最后机会做正确的事，该协议的所有其他主要利益攸关方确保没有对冲基金有可能否决克莱斯勒未来的成功， ”一政府官员说，星期四上午。 “他们不采取行动，或者他们自己的经济利益或国家利益并不削弱取得的成就克莱斯勒，菲亚特和其利益相关者，也不会阻碍了新的机会，克莱斯勒已经改组，变得更加强劲向前发展。 ”  

行政官员说，还有其他的负债，克莱斯勒可能需要履行的破产，其中包括一些经销商协议和诉讼。  

在奥巴马政府拒绝了克莱斯勒的重组计划2月17日，并要求50亿美元的额外援助，说是不可行的克莱斯勒作为一家独立公司。  

汽车避免破产前
美国汽车制造商的标志，这与1936年和1949年是美国第二大汽车公司，差一点在1980年破产时，获得15亿美元政府贷款担保，它在1983年偿还，比原计划提前，部分的力量的K - Car和出售其国防单位。  

1998年，它被卖给了三百六十〇点零零亿美元以戴姆勒奔驰-一个动荡结盟于2007年结束时，德国汽车制造商克莱斯勒出售给Cerberus资本管理公司在70亿美元交易。  

Cerberus将会放弃所有权益。  

克莱斯勒去年冬天避免崩溃时，布什政府同意贷款公司40亿美元。今年1月，克莱斯勒金融收到15亿美元贷款，以提高汽车的贷款。克莱斯勒的销量下降百分之三十在2008年，而工业下降百分之十八。在头3个月以来，克莱斯勒的销量从百分之四十六。  

这标志着另一个铁与欧洲汽车制造商-尽管在目前的汽车销售大幅下降。但目前尚不清楚克莱斯勒将如何生存下去，直到2011年-当第一菲亚特启发车辆滚开了装配生产线。  

行政当局已暗示了几个月，它认为破产克莱斯勒-和通用汽车公司-也许是“最好的选择。 ”该官员深信，一个留在破产可能是短暂-指向例如买卖大部分雷曼兄弟在巴克莱银行在短短五天去年。  

但是，政府必须克服强烈反对，工会和密歇根州的美国国会议员。汽车高管一再警告说，他们担心这么多的汽车公司的选择，客户不会买一辆汽车从破产的公司。上个月，奥巴马政府宣布将建立一个十二万五千点〇万美元计划，以保证担保克莱斯勒通用汽车或车辆，如果他们被迫破产，无法履行。

xiaocg2008

这样才看得懂