CORRECTED: Judge to approve plan that pays GM creditors

By @ibtimes on

Corrects closing share price and day of the week, paragraph 2

A U.S. Federal court judge on Thursday said he would approve the bankruptcy plan for Old GM, paving the way for General Motors to begin distributing stock and warrants to some unsecured creditors, a spokesman said.

GM filed for bankruptcy in June of 2009 and its best assets were sold to a new, stand alone company the following month. GM held an initial public offering in November, selling shares for $33 each. Shares closed on Thursday at $33.03, up 15 cents or 0.45 percent on the day.

Many of its complicated claims and assets stayed in bankruptcy court, however, and are part of the Motors Liquidation Company's Chapter 11 plan.

Judge Robert Gerber of U.S. Bankruptcy Court in Manhattan said he would approve the plan during a one-day hearing, according to Tim Yost, a spokesman for AlixPartners.

AlixPartners is the restructuring firm that is running the winding down of Motors Liquidation.

Motors Liquidation was pleased that the court today indicated from the bench that it will be confirming MLC's plan for reorganization and issuing a written decision as soon as feasible, Yost said.

Once the plan is confirmed, a trust set up under the plan can begin distributing a significant amount of stock and warrants to unsecured creditors who have filed claims against the company.

(Editing by Bernard Orr)

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