Chrysler closer to exiting bankruptcy protection

Posted: June 2, 2009 in Chrysler, News

Chrysler predicted that it could emerge from bankruptcy-court protection this week now that a federal judge has cleared the way for the automaker’s sale.

Bankruptcy Judge Arthur Gonzalez approved the sale of most of Chrysler’s assets to Italian automaker Fiat, a union-backed trust and the U.S. and Canadian governments. The sale was part of the restructuring plan backed by the White House, which has lent the automaker almost $5 billion since its Chapter 11 filing April 30.

Chrysler spokeswoman Shawn Morgan says the company filed a request seeking approval of the sale. The automaker wants a hearing on the matter so that it can close the deal well before the June 15 deadline set by Fiat.

President Obama said the court’s decision gave the automaker “a new lease on life” and would allow Chrysler to “successfully emerge from bankruptcy as a new, stronger, more competitive company for the future.”

Chrysler says the deal could fall apart if it’s not hammered out quickly.

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