By Dennis Seid
object to GM sale
n NEW YORK – A group of General Motors Corp. bondholders and some of the automaker’s labor unions filed objections Friday to GM’s plan to sell its assets to a new company that can emerge from bankruptcy protection.
The Unofficial Committee of Family amp& Dissident GM Bondholders claim they are being treated unfairly compared with the automaker’s other stakeholders and deserve more than the 10 percent stake in the new company that they would receive if the sale goes through.
In its motion, the bondholders group accused GM and the U.S. government of unjustly speeding the case through the bankruptcy process at the expense of the bondholders and dividing the new company’s assets “among a few select favored classes.”
As part of GM’s restructuring plan, the automaker wants to sell the bulk of its assets to a new company in which the U.S. government will take a 60 percent ownership stake. The Canadian government would get 12.5 percent of the new GM, with the UAW taking a 17.5 percent share and unsecured bondholders receiving 10 percent. Existing GM shareholders are expected to be wiped out.
Nestle recalls refrigerated
Toll House cookie dough
n NEW YORK – Federal authorities are investigating a new outbreak of a bacteria-triggered illness, this time related to a packaged raw cookie dough.
The federal Centers for Disease Control said its preliminary investigation shows “a strong association” between eating raw refrigerated cookie dough made by Nestle and the illnesses of 65 people in 29 states whose lab results have turned up E. coli bacteria since March.
About 25 of those people have been hospitalized, but no one has died.
Nestle USA voluntarily recalled all of its Toll House refrigerated cookie dough products after the U.S. Food and Drug Administration advised consumers to throw away any Nestle Toll House cookie dough products in their homes and asked retailers, restaurateurs and other foodservice operations not to sell or serve any of the recalled products.
The recall does not affect other Toll House products, including ice cream that contains raw Toll House dough.
U.S. regulators close
three small banks
n NEW YORK – Regulators on Friday shut down Cooperative Bank of Wilmington, N.C., Southern Community Bank of Fayetteville, Ga., and First National Bank of Anthony in Anthony, Kan., pushing this year’s tally of failed banks to 40.
One bank was in North Carolina, another in Georgia, and the third was in Kansas. The wave of bank failures is expected to continue throughout the year as the weak housing market and rising unemployment rate cause more borrowers to default on their loans.
House targets Fed in
Bank ofAmerica probe
n A House panel has subpoenaed documents that lawmakers say could shed new light on Federal Reserve Chairman Ben Bernanke’s role in Bank of America’s acquisition of Merrill Lynch.
The subpoena comes ahead of a hearing next week in which Bernanke is scheduled to testify.
Lawmakers have accused Bernanke and President Bush’s treasury secretary, Hank Paulson, of pressuring Bank of America Corp. Chief Executive Kenneth Lewis into the deal and urging him to keep quiet about Merrill’s financial problems.
Not divulging that information would have violated Lewis’ fiduciary duty to the bank’s shareholders.
GM to recall 900
workers at crossover plant
n DETROIT – General Motors Corp. said Friday it will recall 900 workers and restore the second shift at a factory near Lansing, Mich., because of increased sales of its Buick Enclave, Saturn Outlook and GMC Acadia large crossover vehicles.
Spokeswoman Sherrie Childers Arb said the laid-off workers will come back to the plant in Delta Township starting Aug. 24, with the second shift continuing indefinitely.