Updated from Thursday, July 9
has emerged from bankruptcy protection after signing papers to transfer the bulk of its assets to a new, leaner company majority-owned by the U.S. government, according to reports.
A person who asked to remain anonymous because the action hasn't been officially announced, said Friday the action came at 6:30 a.m. EDT, the
The bankruptcy of GM will long be remembered for one thing: speed.
In the end, it took less time to restructure GM, which filed for bankruptcy court protection on June 1, then it took to restructure far-smaller
GM was in court for just 40 days, while Chrysler emerged on June 10 after 42 days.
By some accounts, prospects for the
, given its reduced costs, quality improvements in its products over the last several years and the cyclicality of auto sales. However, CEO Fritz Henderson will have to execute to make the promise a reality.
Of course, like Chrysler, GM will leave its bad assets in a second company, called Motors Liquidation, which will go through a more conventional, slower Chapter 11 bankruptcy, in which assets are sold and liabilities are liquidated over a period of years. For the time being, existing GM shares, linked to Motors Liquidation, will continue to trade. Although they are worthless, the shares closed Thursday unchanged at about 84 cents.
Henderson will discuss the changes in GM, and the company's prospects, at a news conference scheduled for 9 a.m. Friday in Detroit.
At noon on Thursday, U.S. Bankruptcy Judge Robert Gerber's order, enabling GM to sell its most valuable assets to a new company, took effect. Thursday afternoon, GM attorneys were working to formally exit bankruptcy and begin operations as a slimmed down company, 61% owned by the U.S. government, and managing just four brands: Buick, Cadillac, Chevrolet, and Chevrolet. The government lent GM up to $50 billion.