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Thursday, April 30, 2009

Chrysler Filing Chapter 11 Bankruptcy

It has been confirmed by the Obama administration that automaker, Chrysler, will be filing for Chapter 11 bankruptcy and Obama, again, will be speaking to the people about the auto industry.

Wall Street Journal:

An Obama administration official said that Chrysler LLC, after failing to convince all of its lenders to agree to a debt-reduction deal, will file for a Chapter 11 bankruptcy.

President Barack Obama will deliver remarks on the auto industry at noon.

Earlier Thursday an administration official said the restructuring of Chrysler LLC will go forward even though a handful of hedge funds have refused to accept the Treasury Department's offer to cut the auto maker's debt.

"Their failure to act in either their own economic interest or the national interest does not diminish the accomplishments" by Chrysler, its planned alliance partner Fiat SpA and other stakeholders in the company, the official said, "nor will it impede the new opportunity Chrysler now has to restructure and emerge stronger going forward."

The administration's auto task force tried to get all 46 of Chrysler's secured lenders to agree to a debt-reduction deal until talks broke down late Wednesday. President Obama is expected to announce that Chrysler is now going to seek reorganization in bankruptcy court.

CNN Money
, NYT, and AP all on this story.

No commentary at this time, will try to link Obama's comments on this after he speaks.