Chrysler Opponents Unmasked

Posted by: Matthew Goldstein on May 06

Thanks to a ruling from a US Bankruptcy judge, the dissident hedge funds that helped pushed Chrysler into bankruptcy have been unmasked. The hedge fund managers had tried to remain anonymous, citing threats on their lives. But Judge Arthur Gonzalez would have none of that excuse and ordered a lawyer for the dissidents to divulge the hedge funds’ names.

The list of dissidents is much smaller than the original 20 or so hedge funds that veoted a pre-bankruptcy deal to reduce Chrysler’s outstanding secured debt. The list of hedge funds that are still members of the opposition group calling themselves Chrysler Non-Tarp Lenders is down to just six funds. In all, the funds control $295 million of Chrysler debt, a far cry from the nearly $1 billion the original group of 20 had controlled.

The dissidents included funds managed by Schultze Asset Management, Arrow Hedge Partners, Stairway Capital, OppenheimerFunds, Foxhill Capital Partners and Group G Partners. Early on, Stairway Capital and Oppenheimer had been identified as leaders of the Chrsyler holdouts, but the others funds had not.

Group G may be the most interesting dissident of all. On the eve of the Chrysler bankruptcy, Group G principal Geoffrey Gwin was the subject of story in The Wall Street Journal, which detailed his anguish about how to vote on the Chrysler debt reduction package. In the April 30 story, Gwin said he was still wrestling with his decision, but never identified himself as a member of the non-Tarp lender coalition. Gwin tells me he joined the group after the WSJ story hit the newsstands.

Hmm. Could a WSJ follow-up now be in the works?

Reader Comments

Mike

May 6, 2009 07:52 PM

Good For them. They should hold out.

JimG

May 6, 2009 08:00 PM

Matthew -- Thanks for keeping BW on the cutting edge. You're doing a bang-up job of covering the markets. Keep up the good work! -- Jim

Chris

May 7, 2009 12:06 AM

I dont care if its a dime or a dollar, the rights of the first secured lein holder is paramount for investment and contract law in the future. Obama is playing a dangerous game.

JaneJim

May 7, 2009 12:39 AM


Banks have huge debts, but they're getting a helping hand from the federal government. If you have overwhelming debt--perhaps from bad investments, or maybe a job loss, a medical crisis or just plain overspending--you're probably on your own. Check the website http://obamadebthelp2009.blogspot.com
to see if they can help. I am glad I did read it before I talk to my CC company and it helped - Jane Jim, California

Snoz

May 7, 2009 02:20 AM

Had the US government not intervened in Chrysler's financial collapse, American taxpayers would have saved over $15billion that Chrysler declared it can not repay. What is true as to Chrysler's inability to repay its loan will be true for the several $trillion bailout money to AIG, financials, big banks, and GM. The American taxpayer, his children, his children's children, and his children's grandchildren will have to slave away until death because their government for the people, by the people, of the people, had mortgaged their futures for the good of the filthy rich. When the average ordinary American goes bankrupt, his government does not intervene to stop secured creditors from foreclosing on collateral, or loan him TARP money or pay him a bonus. Also, for decades this government stated there is no money for a national healthcare program. So, why has this government found several $trillion as free gifts to the wealthy without any hope of repayment? As this government has seized ever more private properties and converted them into government properties, this Nation is fast becoming a socialist and communist nation. When your government prevents lenders from foreclosing on their collateral, is there any capitalism left? The American people should be in the streets demanding fidelity to the US Constitution, recalling their Congressmen who voted for these bailouts, and demand accountability over this treason.

Tyranny!!

May 7, 2009 01:46 PM

Bailout the irresponsible and punish the responsible!! are the unions being penalized for sucking up all our tax money?

blah

May 7, 2009 05:02 PM

blah, blah, blah.....Unions! blah blah blah blah........Socialism! blah blah blah blah Lienholder! Chapter 11 is supposed to reorganize a business into a VIABLE entity going forward. Chrysler is broke. The financial markets were screwed up by liars and the greedy. Every time you let a Bush near the mortgage market a bank (or savings and loan) goes broke [Neil Bush]. The holdouts are having their day in court. If they can get a better deal....let them. All I know is the Ayn Randians are wrong. The wealthy are waging war on the middle (working) class. And I'm getting screwed.

Reader

May 7, 2009 06:31 PM

Welcome to communism 2.0.
So, here’s the arrangement: You pay your taxes, the Obama administration funnels some of the money to the UAW (illegally screwing the bond holders), which in turn funds Obama’s re-election.

brad

May 7, 2009 08:23 PM

hmmmmmmm there names even sound shady

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BusinessWeek's Adrienne Carter, Jessica Silver-Greenberg, and David Henry deconstruct the mysteries of high finance, Wall Street, and hedge funds for pros and ordinary investors. E-mail them directly if you've got tips about big deals, a hedge fund, or even securities industry gossip.

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