Monday, June 8, 2009

Chrysler Fiat Sale Delayed by U.S. Justice Ginsburg

Posted on Bloomberg by Greg Stohr and Tiffany Kary:

Justice Ruth Bader Ginsburg ordered a delay in Chrysler LLC’s planned asset sale to a group led by Italy’s Fiat SpA while the U.S. Supreme Court considers a request for a longer postponement that might scuttle the deal.

A federal appeals court in New York last week allowed the sale, while ordering the decision put on hold until 4 p.m. today Washington time to let opponents seek Supreme Court intervention. Indiana pension funds and consumer groups asked for an order blocking the sale while the Supreme Court decides whether to take up the funds’ appeal.

Ginsburg’s one-sentence order, which came only in the pension fund case, said the bankruptcy court orders allowing the sale “are stayed pending further order” of the Supreme Court.

Chrysler said in court papers that the sale is necessary to stanch losses of $100 million a day. Chrysler said the sale, which would transfer its Jeep, Chrysler and Dodge brands, would help save 38,500 jobs plus those of workers at its suppliers.

Fiat has set a June 15 deadline for completion of the deal.

The Indiana pension funds hold $42.5 million of $6.9 billion in Chrysler secured loans.

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