NEW YORK – Chrysler LLC could exit bankruptcy reorganization as soon as Monday, after barely a month in Chapter 11 protection.
Judge Arthur Gonzalez of the U.S. Bankruptcy Court in Manhattan rejected arguments from some Chrysler creditors and dealers seeking to block the deal, noting in his 47-page judgment that Fiat SpA was the only viable alternative to the immediate liquidation of the company.
The ruling, which came just a month after Chrysler was forced to file for protection, is viewed as a partial dress rehearsal for the more complex reorganization of General Motors Corp., which is expected to file in the same court later Monday.
Disgruntled Chrysler dealers faced with being dropped by the company and a group of Indiana pension funds had been the main barrier to the company's court exit following a marathon three days of hearings last week. Judge Gonzalez rejected their efforts to block a sale of Chrysler assets to the Fiat-led group.
Chrysler's exit would be a victory for the U.S. government, which has been overseeing Chrysler's restructuring.
The reorganized Chrysler — to be called Chrysler Group LLC — will be transferred over to fresh owners: the U.S. and Canadian governments; a trust fund that will cover the cost of health care for retired union workers; and Fiat. Some of Chrysler's assets, including a number of plants to be closed, would remain in bankruptcy for some time.