The judge presiding over Chrysler’s bankruptcy case approved on Sunday the sale of the company’s assets to a group consisting of Fiat, the UAW health care trust and the U.S. and Canadian governments. Nearly all of the objections that threatened to stall the sale were thrown out, according to Reuters.
The new company, which will be named Chrysler Group LLC, will be 68% owned by the United Auto Workers health care trust. Fiat will own 20% of the new company. The U.S. and Canadian governments combined will own just 12% of Chrysler.
One of the most publicized objectors to the sale was a group of Chrysler dealers made up of some of the 789 that will be forced to close. The judge said that terminating franchise agreements is allowed in every bankruptcy, and slowing the sale would have hurt Chrysler’s chances for survival after bankruptcy. There is a hearing on dealer contracts set for Wednesday.
Proceeds from the $2 billion sale of Chrysler’s assets will go to senior lenders, who will receive about 29 cents on the dollar. None of that money will go to the union, the governments or Fiat, all of whom are taking a stake in the new company.