Chrysler Talks Break Down, Bankruptcy Looms
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Talks between the US Treasury Department and Chrysler LLC lenders over the automaker's debt broke off late on Wednesday, leaving bankruptcy the automaker's all but certain option, news agencies reported.
Chrysler will file for bankruptcy after the talks broke down, since its 80 percent of stocks are controlled by private-equity firm Cerberus Capital Management LP, Reuters reported, quoting the Wall Street Journal.
The Associated Press also reported that the talks "have disintegrated," citing its own sources.
"After allowing talks to continue late into the night Wednesday, the Treasury Department finally ended negotiations after the hedge funds were unable to come to an agreement," the AP report said.
The US government had set an April 30 deadline for Chrysler to strike a deal with Fiat after concluding that the struggling automaker would not be viable on its own.
The talks between Chrysler LLC's lenders and the Treasury Department was aimed at reducing the automaker's 6.9 billion dollars in secured debt and keep it out of bankruptcy protection.
The breakdown also means further emergency government aid for Chrysler will be withheld.
(Xinhua News Agency April 30, 2009)
