A New York judge approved the sale of most of General Motors Corporation's assets to NGMCO, Inc., an entity funded by the U.S. Department of the Treasury, on late Sunday, thus opening the way for a quick exit from Chapter 11 in less than 40 days after the company filed for court protection. Under the deal, 60.8 percent of the new GM's common stock will be owned by the U.S. government, 17.5 percent by the UAW Retiree Medical Benefits Trust, 11.7 percent by the Canadian and Ontario governments while the remaining 10 percent by the old GM.
GM said that Judge Gerber's order includes a four-day stay before closing of the sale can occur, with the automaker expecting the sale to be completed in the near future.
"The new GM's business is expected to be immediately operational and fully competitive, with an exciting line of new products, a smaller, more focused brand portfolio and the rationalization of its dealer network well underway," the automaker said in a statement adding that current GM employees will be offered positions by the new company.
Along with the closing, it was decided that the current General Motors Corporation will change its name to 'Motors Liquidation Company' with the retained assets set to 'wound down' or sold.
The new company that will be formed will be headquartered in Detroit and will be led by Fritz Henderson as president and chief executive officer and Edward E. Whitacre, Jr. as chairman of the board of directors.
"A healthy domestic auto industry remains vital to the global economy and we deeply appreciate the support the U.S., Canadian and Ontario governments and taxpayers have given GM, and the sacrifices that have been made by so many," said Henderson.
"This has been an especially challenging period, and we've had to make very difficult decisions to address some of the issues that have plagued our business for decades. Now it's our responsibility to fix this business and place the company on a clear path to success without delay."