NEW YORK — Chrysler chief executive Robert Nardelli said Thursday he expects the sale of the bulk of Chrysler’s assets to a group headed by Italy’s Fiat Group to close today, assuming the judge overseeing the automaker’s bankruptcy-protection case approves the deal.
Nardelli testified in court that he expects the required U.S. regulatory approvals for the sale to be in place by today and international approvals to follow shortly thereafter.
But it’s likely that if U.S. Judge Arthur Gonzalez does approve the deal, attorneys representing three Indiana state pension and construction funds, which hold Chrysler debt and are aggressively opposing the sale, will appeal the decision and force the company to postpone the closing. Fiat could back out if the deal doesn’t wrap up by June 15.
Chrysler on Thursday began its second day of testimony to convince Gonzalez that selling itself to Fiat was the best way to avoid liquidation. Attorneys for Chrysler say a leaner company could shift more easily to building smaller, more fuel-efficient cars.
But many Chrysler dealers, bondholders and former employees say they are being steamrolled by the exceptionally speedy bankruptcy-court proceedings.
If the judge approves the sale, as expected, the automaker could emerge from Chapter 11 bankruptcy protection within weeks, defying observers who said the company could linger under court oversight for years. Chrysler filed for Chapter 11 bankruptcy protection April 30.
In testimony Thursday, Nardelli described the events leading up to Chrysler’s bankruptcy filing. He said Chrysler attempted to cut costs and restructure itself throughout 2008, but a steep drop in vehicle sales and tight credit proved to be too much, sending the industry into a “death spiral” by summer.
