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Bankruptcy Judge OKs Sale of Chrysler Assets to Fiat

06/01/2009
A federal bankruptcy judge has approved the sale of most of Chrysler LLC's assets to the automaker Fiat of Italy, which clears the way for Chrysler to emerge from bankruptcy protection. The Associated Press (AP) reports that the the court ruled that a proposed sale would be a step toward preserving the value of Chrysler's business and what is left for stakeholders. "Any material delay would result in substantial costs in several areas, including the amount required to restart the operations, loss of skilled workers, loss of suppliers, and dealers who would be forced to go out of business in the interim, and the erosion of consumer confidence," said Judge Arthur Gonzales in his ruling, quoted by AP. AP says that a group of Indiana state pension and construction funds have threatened to appeal the decision if Gonzales approved the sale; the funds own $42.5 million of Chrysler's $6.9 billion debt and object to the sale on the grounds that it does not provide a large enough return for secured debt holders while paying off unsecured debt holders.

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