Previous 21 - 30 Next
Some bondholders have expressed disappointment in being unable to participate in the new stock offering, annoyed at being forced to wait for the conversion to stock and warrants. I believe this will prove to be irrelevant as the bonds are now changing hands at prices that will reflect and track the movement of the stock, anticipating the eventual conversion. On the morning the IPO was released to trade, the GM benchmark 8 3/8% bonds were trading at 34 to 35 cents on the dollar, a far cry from May of 2009, when they hit bottom at approximately 1.5 cents.
The General Motor's bondholder's scenario. Unmentioned amid the overwhelming publicity surrounding the stock offering were the original unsecured GM bondholders. My effort to explain their position follows: According to the trustee, the bondholders who technically own all the assets of the old GM Corp. (Motors Liquidation Company) will receive 10% equity in the new GM along with warrants for an additional 15%. The timing of this distribution of equity to unsecured bondholders is subject to the bankruptcy court process and will occur after a reorganization plan is submitted, accepted and implemented. It cannot be determined how long this will take, but three to six months seems to be a reasonable estimate.
The GM turnaround story has been remarkable considering the company emerged from bankruptcy proceedings in 2010 and has now strung together three consecutive profitable quarters. Analysts expect GM to have its first full year profit since 2004. Industry experts believe that the company's new debt structure, amended union contracts and upgraded product line will enable GM to continue to compete favorably with both foreign and domestic automakers. Let's not forget that the socializing of the American auto industry began under George W. Bush and the Republican party. Can't we all good conservatives agree that de-socialing under Obama is a good thing?
GM Bondholders: A View From the Back Seat (A view the Republican party does not want you to see) The highly anticipated General Motors Initial Public Offering opened for trading in November of 2010 amid fanfare and hoopla worthy of a royal coronation. GM executives rang the bell on the stock exchange, followed by the ear shattering sound of the revving engine of a new Chevy Camaro.  The IPO raised $15.8 billion, the largest public share offering in financial history. The government's ownership in the company was reduced to 33% from its original stake of 61%.
The Republican party has publicly stated they want General Motors to fail, the Republican party wants our foreign born Quranic-toting president to fail. The Republican party wants America to fail. The Republican party wants Corporate Welfare to reign supreme in America's future. Having America fail is in the Republican party's interest as then they can remake America to suit it's teat sucking, parasitic style. And friends, let's not forget that the socializing of the American auto industry began under George W. Bush and the Republican party. Can't we all good conservatives agree that de-socializing under Obama is a good thing?
Also, because of the broad economic ramifications of the company's demise, most stakeholders are aiming for a relatively quick restructuring for some part of the company to emerge from bankruptcy and continue operating. "Most bankruptcies take 12 to 18 months," Williams said. "Everyone has said they would like this to happen quickly and that's in the interest of creditors to not have to wait for some resolution."
General Motors had thousands of creditors, including the labor unions and institutional bondholders like mutual funds and pension funds. It also had around 100,000 individual bondholders, holding about 20% of the company's $27 billion in outstanding debt, according to 60 Plus, a senior advocacy group that had lobbied lawmakers for individuals who held GM bonds. The committee representing institutional bondholders had proposed a plan for bondholders to swap debt for 10% equity in the newly formed company, with warrants for up to another 15% stake as the company grows. Legal counsel for that committee asked investors to contact them so they would have a better sense what percent of debt holders supported the plan.
Let's refudiate the latest Republican talking point concerning General Motors bondholders. The original GM bondholders didn't have their rights violated. Unsecured debt, which is what these bondholders had, means that they should have gotten nothing from bankruptcy. They are getting something when they should have gotten nothing. What is so hard to understand about this?
I saw some time ago that Government Motors is shedding some of its government equity in favor of private ownership. Can't we all finally agree that George W. Bush socialized General Motors, and now that aformentioned company in the auto industry, is on the road to being DE-socialized under our foreign-born Islamic president?
The Wall Street Journal for the weekend of January 15-16, 2011 has an article titled "The Great Auto Restructuring Shows Signs of Success." I heard that General Motors will fail because it caters to the UAW. But, I must admit this article seemed to clear that mis-perception. Toward the bottom of the second column it clearly says "GM's hourly labor costs now amount to just 6% of its revenue in North America. That's down from 30% a few years ago..." Hellooo....6% is just one-seventh of the money it receives in sales. Not a large component in the ole annual INCOME STATEMENT. All conservatives could and should learn more about the GM restructuring! I will take that burden onto myself.
uh....I thought we have been at war with the Islamo-Fascists for quite some time now. Question to all my conservative friends out there; was Muammar Ghadaffi an Islamo-Fascist? Who here had heard of GWOT; the Global War ON Terror.......
Previous 21 - 30 Next