Facing a looming June 1 deadline to reach agreements with the bondholders and union, General Motors may have failed to come to terms with the former, but it has reportedly arrived at a tentative concessions agreement with latter.
The deal puts the United Auto Workers' trust fund in charge of future health care costs in exchange for a 17.5% stake in the reorganized General Motors. The U.S. Treasury is still expected to take the controlling stake in the reorganized company. In addition, the agreement calls for GM to put $10 billion in assets in the UAW's Voluntary Employee Beneficiary Association VEBA and to issue the union a $2.5 billion note to be payed in three installations in 2013, 2015, and 2017.
With just days to go before a likely Chapter 11 bankruptcy, GM remains in survival mode.
