US: 'Old GM' chief sees liquidation plan ready mid-2010
The chief executive of Motors Liquidation, the old shell of General Motors that remains in bankruptcy court, is hoping that the company will get court approval for a plan of liquidation by the middle of next year, he said.
Al Koch, who was named as GM's chief restructuring officer in June and tasked with winding down the liquidation company in July, told Reuters Motors Liquidation would seek approval for the plan in "mid next-year", which would allow the company to distribute its holdings of 'new GM' stock and warrants to unsecured creditors.
He said his aim was to have a liquidation plan for the old GM assets confirmed by the court by the middle of 2010. "That's our objective," Koch said.
"The assets that I have and that my team has to liquidate are pretty challenging," Koch said in comments to the Reuters Restructuring Summit in New York, noting that completing most of the liquidation process could take another five years.
"The properties that we have to dispose of are so large, that it's going to be very difficult to find users for them, and many of them have some environmental remediation that's required," he added.
Koch said he expects creditors to file claims of at least $30bn to $40bn against the company, but the estate was left with far fewer assets.
Koch, a turnaround expert with advisory firm AlixPartners who also served as chief financial officer of Kmart through its bankruptcy in 2002 and 2003, said he has assembled his staff of about 50 into three teams focused on Motors Liquidation's real estate, equipment, and environmental issues.
The environmental remediation and legal and regulatory issues associated with that could take as long as 30 years to resolve, Koch said, but he expects the company's hard assets could be disposed of over the next five years.
Koch said the company has about 200 properties, of which about 100 are leased to the 'new GM' for its current use, but will eventually revert back to the old company. Many of the properties are plant sites or landfills which it will have to clean up and the company also has about 5,000 robotic machines and other tools that were left on the properties, Koch said.
Motors Liquidation, however, expects to have difficulty finding buyers for its assets as few auto companies are looking to expand at the moment, Koch said.