General Motors was skidding toward bankruptcy on Wednesday after bondholders rejected a plan to swap a large portion of the troubled
automaker’s debt for equity in the firm.
GM said it failed to get enough participation in a plan to exchange 27.2 billion dollars of its notes, which had been required under GM loan agreements with the US Treasury and the company’s own “viability” plan.
GM was widely expected to file for bankruptcy protection ahead of a June 1 deadline imposed by the administration of President Barack Obama, which has providing the automaker with billions of dollars in emergency loans.
The rejection suggests a likely bankruptcy filing that some analysts say could be messier and longer than that of Chrysler, which appeared poised to emerge as a new entity from court supervision.
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