The US parent of GM Holden has filed for Chapter 11 bankruptcy, allowing Holden to keep trading, but questions about the local car maker remains.
Under the bankruptcy reorganization that now has support of GM bondholders, the US government would own around 70% of General Motors.
GM said the U.S. Treasury agreed to the plan to create a new company that buys the assets of the automaker and that bondholders who had rejected an earlier proposal “support the economic terms” of the new plan.
The government could provide “in excess of $50 billion” to this reorganization that would be converted to stock, according to a GM filing with the Securities and Exchange Commission.
Industry minister, Senator Kim Carr said he expected Holden would be safe even though GM has filed for Chapter 11 in the US.
He also said it was important to remember that Chapter 11 bankruptcy in the US is very different to bankruptcy in the Australia. “It does not mean GM is being liquidated or is going out of business.”