Big Three, Bankruptcy | featured news

CEO Fritz Henderson calls the move 'a defining moment' in the company's reinvention. In trading, shares of GM dropped 28%. Meanwhile, Chrysler takes another step toward emerging from bankruptcy.

Approval of sale of assets to Fiat clears way for U.S. automaker to exit bankruptcy protection.

A majority of bondholders agree to swap their debt for a stake in a reorganized GM, which is expected to file for Chapter 11 on Monday.

Robert Nardelli, Chrysler's departing chairman and chief executive, said he expects the sale of the bulk of Chrysler's assets to a group headed by Italy's Fiat Group SpA to close Friday, assuming the judge overseeing the automaker's bankruptcy protection case approves the deal.

G.M. said a key group of bondholders agreed not to oppose the reorganization plan in exchange for a stake of 10% in the new G.M., with warrants to buy an additional 15%.

G.M. prepared for a bankruptcy filing, as bondholders rejected an offer to exchange $27 billion in debt for stock.

Judge's approval would set up one of the biggest, fastest bankruptcy proceedings of its kind.

The government will likely hold a large share of G.M. after it emerges from bankruptcy, and the union will hold 17.5 percent through its health fund.

Some auto dealers that Chrysler LLC plans to close are beginning a challenge to the automaker's plans to quickly sell itself in bankruptcy.

After 100 years in business and 10 months of frenzied but failed restructuring, General Motors Corp is weeks from the bankruptcy filing experts say will be required to complete the Obama administration's bid to reshape a fallen icon of American industry.