A Victory for GMAC Holdouts?

It looks like anybody who refused to participate in the GMAC bond tender offer is going to end up feeling pretty smug:

The U.S. Treasury said it will purchase a $5 billion stake in GMAC LLC, the financing arm of General Motors Corp…

Separately, GMAC said it has accepted all bonds tendered in a debt swap designed to reduce its debt load.

“Once the offers are settled, which we expect to do promptly, results will be disclosed,” said spokeswoman Gina Proia in an e-mail.

In order to be able to accept the tendered bonds, I think that GMAC must have managed to reach the 75% hurdle. But the holdouts — the 25% or less of bondholders who didn’t tender their bonds into the offer — are now going to find themselves with GMAC debt which is senior to the preferred equity that Treasury is buying.

Since there’s very little chance of GMAC defaulting to the Treasury, or forcing it into a restructuring of its stake, those bondholders’ coupon payments are probably pretty safe for the time being. And, of course, they’re significantly higher than the coupon payments that the people who did tender into the exchange offer are going to receive. Intransigence and unhelpfulness, it seems, is being rewarded. Which is not a good omen for the forthcoming negotiations with GM’s bondholders.

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