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Chrysler sale approved

by Bill Cawthon on

Judge Arthur J. Gonzalez approved bidding procedures for the rapid sale of Chrysler assets late last night. Saying “there is an urgent need for the deal to be consumated,” he overruled objections from a group of lenders who termed the speeded-up process an “absurdity.”

Chrysler had asked for permission to have a quick sale of most of its assets to a new company held by Fiat SpA, the United Auto Workers’ Voluntary Employee Beneficiary Association, and the U.S. and Canadian governments. The lenders had sought to delay the sale or make the bidding more competitive. They claimed the approved procedures will prevent anyone but the government from submitting a successful bid.

Gonazales denied the lenders’ motions, ruling that courtroom testimony had shown the procedures were designed to “encourage bidding from any interested party.”

Potential “interested parties” did get an additional five days to submit bids. Judge Gonzalez set a deadline of May 20 for submission and set a May 27 hearing date for approval. Chrysler had originally asked for a May 22 approval date. Bidders must include a 10 percent deposit with their bid.

The judge also approved a $35 million breakup fee to be paid to Fiat if a better offer for the Chrysler assets emerges.

Bill Cawthon grew up in the auto industry in the 1950s. His Dad worked for Chrysler and Bill spent a number of Saturdays down on the plant floor at Dodge Main in Hamtramck. Bill is also the U.S. market correspondent for, a British auto industry publication, and a member of the Texas Auto Writers Association, which has named the Jeep Grand Cherokee the “SUV of Texas” several times and named the Ram 1500 as the “Truck of Texas” two years running.

Bill has owned five Plymouths (including the only 1962 “Texan”), one Dodge and one Chrysler and is still trying to figure out how to justify a Wrangler. He also has owned at least one of every 1:87 scale model of a Chrysler product. You can reach him directly at (206) 888-7324 or by using the form.

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