Chrysler creditors call it quits
The Chrysler lenders who were putting up such a fight over the bankruptcy and Fiat deal have decided to throw in the towel. The creditors withdrew their protest today after a couple of the big players in the group abandoned the fight because the "financial and political costs were too high."
From the Wall Street Journal:
"Being such a small group trying to fight the force of the government made [the funds] very uncomfortable," said Thomas E. Lauria, a lawyer with White & Case LLP who was hired in early April to represent the creditors, who identified themselves as "non-TARP lenders."
You can't fight city hall. Or President Obama, apparently. Not without a lot more muscle.
The creditors say they'll go along with whatever deal they get in bankruptcy, which isn't likely to be a very good one.
But taxpayers won't get a penny back of the $7 billion the government loaned to Chrysler. The government will get an 8% equity stake in the restructured company. Hope that turns out to be more profitable than being a bondholder.