Insolvency RecordCASE FILES

United States ยท Automotive manufacturing

General Motors Corporation (later Motors Liquidation Company) insolvency: proceedings and outcome

General Motors Corporation filed for Chapter 11 in the US Bankruptcy Court for the Southern District of New York on 1 June 2009, with debtor-in-possession financing of up to 33.3 billion USD from the US Treasury and the Canadian and Ontario governments. On 10 July 2009 it sold substantially all of its assets under section 363 of the Bankruptcy Code to a new company formed by the US Treasury, General Motors Company, and renamed itself Motors Liquidation Company. The remaining estate was wound down under a plan that became effective on 31 March 2011.

Sold as going concern The operating business was sold to General Motors Company, formed by the US Treasury, in July 2009. The old company was wound down as Motors Liquidation Company, with trusts distributing New GM securities to unsecured creditors and handling environmental and asbestos claims.2,3

First filing1 June 2009
Proceedings1

No balance sheet total captured. DIP financing of up to 33.3 billion USD was expected from the US Treasury and Export Development Canada. Figures as of 1 June 2009.1

Proceedings

TypeCourt or bodyCaseFiled
Chapter 111US Bankruptcy Court for the Southern District of New York, United States (New York)09-50026 (REG)1 June 2009

Timeline

  1. General Motors Corporation and three affiliates filed Chapter 11 petitions and signed a sale agreement with Vehicle Acquisition Holdings LLC, formed by the US Treasury.1
  2. The court authorised interim borrowing of up to 15.0 billion USD of debtor-in-possession financing.1
  3. The bankruptcy court issued the sale order.2
  4. The sale of substantially all assets to General Motors Company closed and the old company became Motors Liquidation Company.2
  5. The bankruptcy court confirmed the liquidation plan.3
  6. The plan became effective. Existing equity was cancelled and the GUC Trust and other trusts were established.3

Creditor recovery

Holders of allowed general unsecured claims receive New GM securities through the GUC Trust. The old company received 10% of New GM common stock and warrants for 15% on a fully diluted basis. The company did not expect former equity holders to receive any distribution.2,3

Sources

  1. US Securities and Exchange Commission (EDGAR), General Motors Corporation Form 8-K (Chapter 11 filing and sale agreement) (3 June 2009)
  2. US Securities and Exchange Commission (EDGAR), Motors Liquidation Company Form 8-K (completion of sale to General Motors Company) (14 July 2009)
  3. US Securities and Exchange Commission (EDGAR), Motors Liquidation Company Form 8-K (plan confirmation and effective date) (4 April 2011)