GM bondholders reject offer

By doris | Published: May 27, 2009

Full Story At money.cnn.com

NEW YORK (CNNMoney.com) — General Motors has fallen far short of the bondholder support it needed for its proposed debt-for-stock offer, according to a source familiar with the matter, virtually guaranteeing that the nation’s largest automaker will be forced to file for bankruptcy court protection within the week.

The bondholders own $27 billion in corporate notes. GM (GM, Fortune 500) needed owners of 90% of those bonds to accept stock in return for the debt in order to reduce its interest expenses to a more manageable level.

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