Several of GM’s labor unions and a group of General Motors bondholders filed objections on Friday, June 19, 2009 to GM’s plan to sell its assets to a new company. Under GM’s restructuring plan it had intended to sell the majority of its assets to a new company in which the federal government would own a 60% share, the Canadian government 12.5%, and the UAW 17.5% with the remaining unsecured bondholders to receive 10%. The owners of present GM shares would receive nothing.
These objections together with others filed by a few states and cities, other consumer groups, individual retirees, and other bondholders and shareholders may delay GM’s rapid emergence from the Chapter 11 process. The objecting bondholders group calls itself the Unofficial Committee of Family and Dissident GM Bondholders. It stated in Its objection that it was being treated unfairly compared to the interests of other stakeholders and that it deserved greater than a 10% share in the new company which had been proposed if the sale of GM’s assets went through. The group compared itself to the United Automobile Workers union which was scheduled to receive a 17.5% stake in the new company. The bondholders group claims it represents approximately 1,500 bondholders with interests exceeding $400 million. In its objection it also asked the bankruptcy court to allow it to create a committee that could negotiate with GM’s separately from the larger bank and investment firm bondholders. A hearing on the matter was scheduled for June 23, 2009.