As frustrated General Motors bondholders brace themselves for the automaker’s all-but-certain bankruptcy Monday, some are still holding out slim hope they might still score a better deal in court than the one being offered by Uncle Sam.
Jim Martin, president of the 60 Plus Association — which represents a small faction of mom-and-pop retail bondholders who hold as much as $6 billion in GM bonds — is mounting a last-ditch attempt this weekend to fight the government.
Martin is auditioning law firms to represent his group as GM prepares to file for Chapter 11 on Monday, ending more than 75 years as the world’s biggest car company.
But even Martin admits that picking a fight with government is a losing battle.
“The Obama administration is playing chicken with [us] and now they are trying to demonize any dissenters. They did it with . . . Chrysler and . . . they’re doing it now,” Martin told The Post.
Yesterday, the prospects for Martin and other small bondholders got even slimmer as the United Auto Workers union agreed to a series of concessions that will slash costs at a newly restructured GM.
“We are satisfied we’ve done the right thing,” Gettelfinger told reporters at UAW headquarters.
The deal struck with the union will give it a 17.5 percent stake in the company with the option to purchase another 2.5 percent later. There were also cuts to medical benefits.
The concessions were approved by nearly three-quarters of the members.
Meanwhile, most bondholders were believed to have accepted a take-it-or-leave-it, sweetened offer from GM that is set to expire today at 5 p.m.
With common shareholders expected to be wiped out in a bankruptcy, GM shares plunged 32 cents to 80 cents — their lowest level since the Great Depression.
GM is surviving on $19.4 billion in US government loans, after losses of almost $88 billion since 2004. Plans are for GM to emerge from bankruptcy as a considerably smaller firm with fewer brands.
For Martin and other dissenting bondholders who feel that they’ve not gotten a fair shake, it’s likely too little, too late.
“The little investors are just getting railroaded left and right. We are trying to set up a separate committee for little investors,” Martin said.
But even with bankruptcy looming, the governmental efforts may still not be enough to ensure that GM makes out as a viable company, some say.
“Here they’ve put GM and Chrysler on artificial life support. But will any of this make people buy their cars?” asked Robert Miller, CEO of independent investment bank Miller Mathis. “It’s hard enough to sell any cars, much less their cars.”
Meanwhile the judge overseeing Chrysler’s bankruptcy said he will rule by Monday on whether Chrysler can sell most of the company to a group headed by Italy’s Fiat.