The bankruptcy judge handling the GM case has granted final approval for the company to borrow some $33 billion from the American and Canadian governments to help the company survive bankruptcy restructuring.
Judge Robert Gerber of U.S. Bankruptcy Court in Manhattan approved the final order for the loan, along with denying a request by nonunion retirees for an official committee to represent them.
The automaker had received interim court approval on June 2 to access up to $15 billion of the bankruptcy financing, also known as a debtor-in-possession, or DIP, loan. Today’s order cleared the way for GM to access the rest of the DIP loan, which is the largest ever approved in a U.S. bankruptcy.
The judge also rejected a bid by 122,000 non-union retirees to be represented in the case by an official committee. Though their pensions will be transferred to the new GM, the retirees face sharp cuts in their medical benefits, including elimination of their dental insurance entirely.
Had an official committee been established it could have negotiated with GM on behalf of those retirees, but the judge ruled against the motion. That leaves those retirees with no leverage and no means of recourse in preventing the loss of benefits.