GM's new offer for bondholders may contain no cash, just equity
In Henderson's words, "That equity is part of the offer." What he might actually mean is that equity is the offer. CNBC reports that the "Treasury Department wants GM to offer its bondholders a small amount of its stock in exchange for their $29 billion of GM debt."
Having turned down much better offers, we don't expect bondholders to signal approval now. From the outside this looks to be a showdown: GM has appeared to accept the prospect of bankruptcy, and while it wants to tend to business out of court, it will enter a pre-packaged Chapter 11 if necessary; bondholders appear to be looking at The General as if it's got a gun to its head, and they're waiting to see what happens when the trigger gets pulled. We don't have much longer to wait...
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