Canada in talks on funding for GM, Chrysler: report

Thu Apr 23, 2009 9:10am EDT
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(Reuters) - The governments of Canada and Ontario are in advanced negotiations to provide bankruptcy financing of as much as $6 billion for the Canadian operations of General Motors Corp and Chrysler LLC, The Globe and Mail reported on its website, citing people familiar with the matter.

National and provincial officials are in the final stages of discussions with the U.S. Treasury and senior auto executives, with the parties looking at Canada to contribute about 15 percent of total funding that could reach $40 billion, the paper said.

GM said on Wednesday that it was unlikely to make a $1 billion debt payment due June 1 because it expects to be restructuring through a voluntary exchange or bankruptcy court by that point.

Chrysler has been trying to reach a deal with Fiat and obtain cost cuts from debt holders and its unions as it faces an April 30 deadline to avert probable insolvency.

(Reporting by Jennifer Robin Raj in Bangalore; Editing by Lisa Von Ahn)

<p>General Motors auto workers prepare rows of the new Chevrolet Camaro for delivery, at the company's Oshawa Ontario facility in this April 8, 2009 file photo. REUTERS/Fred Thornhill</p>