cwalenta Wrote:
Sep 08, 2012 11:37 PM
Uh-well, its a little bit more complicated than that. You have to remember that 'old GM' was in bankruptcy, so the common shareholders are last in line, meaning they weren't going to be getting anything. So, really the story in bankruptcy is who, amongst the creditors gets what. Well, in the case of GM, the government provided debtor in possession financing, also the union WAS a creditor of GM. Believe it or not, as a CREDITOR, the union had higher priority than common shareholders. However, the union's creditor position, its 'priority' was well behind other creditors including some teacher's pension funds out of Indiana - the difference remains the government's contribution of signiificant DIP financing