I am writing today to announce the closure of the Michigan Messenger. After four years of operation in Michigan, the board of the American Independent News Network, has decided to shift publication of its news into a single site, The American Independent at Americanindependent.com. This is part of a shift in strategy, towards new forms [...]
An abstinence-only presentation provided to numerous school districts in Calhoun and Eaton Counties in October of this year provided false and misleading information to students about HIV, experts allege.
Two county registers of deeds filed a class action lawsuit Monday on behalf of Michigan’s 83 counties alleging that the Mortgage Electronic Registration Services owes millions of dollars in property title transfer taxes.
Despite evidence of the impact of mercury on children and public health, Michigan Attorney General Bill Schuette last month joined with 24 other state attorneys general in filing a lawsuit to scuttle new EPA regulations that would reduce mercury emissions from power plants.
The Treasury Department and Chrysler may have managed to work out a restructuring agreement with those who hold debt in the smaller automaker, but the bondholders for General Motors are furious at a similar offer of swapping equity for their debt in the nation’s largest car company. The Free Press reports:
General Motors bondholders — huge and tiny — sharply criticized the offer Monday from the company and the Obama administration to surrender $27.2 billion in debt for up to 10% of a reworked GM and some cash.
The plan, designed to cut GM’s debt by $44 billion, came without input from creditors. GM said if 90% of the debt wasn’t exchanged by May 26, the company would file for bankruptcy and the U.S. Treasury could buy many of its best assets in court.
The committee representing large GM creditors said the proposal was “neither reasonable nor adequate,” adding that the Obama administration was driving GM to bankruptcy.
“We believe the offer to be a blatant disregard of fairness for the bondholders who have funded this company and amounts to using taxpayer money to show political favoritism of one creditor over another,” according to a statement from the committee, which represents about half of the debt.
The other creditor being referred to is the UAW. GM is slated to pay about $20 billion into the union’s retiree healthcare fund over the next couple years as the administration of retiree healthcare transfers from the company to the union in 2010. The government, which has been brokering these negotiations, has been demanding that the debtholders and the union agree to exchange a significant portion of that debt for stock in the companies.
But they are clearly driving a much harder bargain with the lenders than with the union. They want the debtholders to swap about $27 billion in debt for a 10% stake in the company, while they are offering to exchange about $10 billion of the debt owed to the union for a 39% stake in the company. And they’ve got leverage, threatening that if the creditors do not agree to these plans the company could be forced into bankruptcy and they could receive even less — or nothing at all.
It looks as though the Obama administration has been successful at pushing through similar arrangements on behalf of Chrysler, possibly enough to prevent bankruptcy. It remains to be seen if they can do the same for GM.
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