The news at a glance

GM: Bankruptcy looms as bondholders balk; Wall Street: Morgan Stanley revamps pay; Web 2.0: Facebook’s Russian friend; Banking: Year’s biggest bank failure; Air travel: Good news for frequent fliers

GM: Bankruptcy looms as bondholders balk

Holders of $27 billion in General Motors bonds this week rejected the company’s offer to swap their debt for a 10 percent equity stake, “setting the stage for a bankruptcy filing by the troubled automaker,” said CNBC.com. GM had hoped to avoid Chapter 11 by persuading at least 90 percent of bondholders to accept the swap. But reports indicated that hardly any bondholders were willing to make that deal, and that rather than a 10 percent stake in the company, they were holding out for a 58 percent share. Some bondholders expressed anger that GM has proposed giving its unions a 39 percent equity stake, “an unfairly rich payout compared with other unsecured creditors.”

Subscribe to The Week

Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

SUBSCRIBE & SAVE
https://cdn.mos.cms.futurecdn.net/flexiimages/jacafc5zvs1692883516.jpg

Sign up for The Week's Free Newsletters

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.

Sign up
To continue reading this article...
Continue reading this article and get limited website access each month.
Get unlimited website access, exclusive newsletters plus much more.
Cancel or pause at any time.
Already a subscriber to The Week?
Not sure which email you used for your subscription? Contact us