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Approval given for GM bankruptcy plan

Published on 6 Jul 2009 under category: legal

A major carmaker has received approval for its bankruptcy plan.

In news which may interest insolvency solicitors, General Motors (GM) will be allowed to sell some off its assets to a new firm.

The company, which will be backed by the government, is expected to take on the profitable parts of the automaker's business.

Judge Gerber made the decision despite around 850 objections to the plan, bankruptcy solicitors may be interested to hear.

He said: "If GM liquidates, there will not only be nothing for stockholders; there will be nothing for unsecured creditors."

Last month, the company filed for Chapter 11 bankruptcy protection.

It is thought that under this scheme around 60 per cent of the firm will be owned by the new government-backed firm.

GM has sold its vehicles under brands such as Vauxhall, Saab, Cadillac and Chevrolet.

In other news, Lear recently filed for Chapter 11 bankruptcy protection.