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Treasury cuts a deal with banks, Chrysler
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Published: April 29, 2009
Chrysler LLC's largest banks reached a tentative agreement with the U.S. government to exchange $6.9 billion in secured debt for $2 billion cash, say three people with knowledge of the negotiations.
A Chrysler bankruptcy remains a possibility, said one of the people, who didn't want to be identified discussing the private talks.
All the automaker's 46 lenders must ratify the terms, which isn't likely, the person said. A quick type of bankruptcy may be needed to bring any dissenters into an agreement, the person said.
The Treasury Department was negotiating on Chrysler's behalf Tuesday with JPMorgan Chase & Co., Goldman Sachs Group, Citigroup and Morgan Stanley, which hold about 70 percent of the automaker's secured debt, the sources said.
Bloomberg News
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