GM’s unwanted businesses in bankruptcy won conditional court approval

Article by Christian Andrei, on October 21, 2010

General Motors Corp.'s bankruptcy estate is awaiting the court’s approval of a settlement that would set aside $773 million to resolve environmental claims by the federal government and 14 states.

In a statement, Gary Grindler, acting deputy attorney general, said that a combination of cash and assets, placed in trusts, would clean up and administer 89 properties, 59 of which have been contaminated.

Before the bankruptcy court will decide on GM’s request, there will be a 30-day period to gather public comment.

Grindler said that over half of the money will go to sites in New York and Michigan. The St. Regis Mohawk Tribe, the US Environmental Protection Agency and the states are part of the settlement. The tribe has not yet moved to accept the proposal. A public hearing had been set for Wednesday night.

This deal will lead to the company’s unwanted business to wind down in bankruptcy before a hearing on Thursday at which the Old GM estate will ask the court to approve the terms of its liquidation.

In June 2009 when GM filed for bankruptcy, it sold attractive assets to a recently formed company. However, it left 89 properties under bankruptcy protection. These are the properties at issue now in this settlement. [via BusinessWeek]

Topics: gm, bankruptcy

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