DETROIT — General Motors Corp. sped toward a record-short escape from bankruptcy protectitoday when a judge’s order approving the sale of most of its assets to a new company went into effect.
The order, delayed four days to allow time for appeals, became effective despite a last-minute appeal from plaintiffs in an Arizona product liability case against GM involving a Chevrolet Malibu.
GM spokeswoman Julie Gibson said U.S. Bankruptcy Judge Robert Gerber’s order allowing the sale became effective at noon EDT (9 a.m. PDT). GM lawyers are working on paperwork to close the sale as quickly as possible, after which GM would leave bankruptcy protection.
Once the world’s largest and most powerful automaker, GM will become a leaner and greener company, cleansed of debts and burdensome contracts that nearly dragged it into liquidation.
But it faces brutal international competition and the worst auto sales market in more than 25 years.
John Pottow, a University of Michigan Law School professor who specializes in bankruptcy, said opponents had little legal recourse to block the sale because their issues were shot down by higher courts in Chrysler’s bankruptcy case.
“It’s done,” Pottow said. “I knew they were dead as soon as the Chrysler case was decided.”
He expects GM to close the deal and emerge from bankruptcy today in 39 days, a record for a company its size, he said.
GM spokesman Tom Wilkinson said he could not give a time frame for when the sale will close.
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