Chrysler chief Robert Nardelli was to testify later Today in New York bankruptcy court to win approval of its takeover by Italy's Fiat as more than 300 objections have been filed on the plan, according to dpa. But the clock was ticking fast, according to remarks by an executive from Fiat, which stands to win a long-sought foothold in the hefty North American car market. Alfredo Altavilla, head of Fiat Powertrain Technologies, told the court that Fiat wanted the bankruptcy deal to be completed by June 15 or it may reconsider, Bloomberg financial news service reported. Under bankruptcy reorganization, the court must approve the pay- off of creditors. More than 70 per cent of Chrysler's 45 creditors are on board with a deal that would give them 2 billion dollars in cash to forego 6.9 billion dollars in debt. The 2-billion-dollars would come from a group including Fiat, which will take over management of Chrysler as part of its worldwide alliance; a United Auto Workers union benefit trust; and the US and Canadian governments. But a smaller group hopes the court will force a better deal, and more than 300 objections were also on file with the court. They included a group of Indiana state pension and construction funds which say their claims are being improperly subordinated and that the US Treasury Department improperly influenced the Chrysler bankruptcy. "The sale would strengthen Chrysler for the long term, benefiting all constituents, including US taxpayers, employees, creditors, dealers, suppliers and secured lenders," Nardelli wrote in a document submitted Wednesday. "Our sole aim was to benefit everyone." The US government has lent Chrysler at least 4.5 billion dollars. Final ownership would likely see Fiat with a 20-per-cent stake that could be expanded by another 15 per cent as it transfers technology and other incentives to Chrysler's factories. A union retiree health care trust fund would own 55 per cent. The US government would keep an 8-per-cent stake and Canada would get 2 per cent. Chrysler declared bankruptcy on April 30, and US President Barack Obama is insisting on a speedy process within 30 to 60 days. Chrysler has shut down assembly lines in the US and Canada until the outcome is clear. Chrysler, the third largest US car maker, is expected to be followed into bankruptcy by the largest manufacturer, General Motors, on Monday. Altavilla said the Italian automaker would name Sergio Marchionne, its chief executive officer, and himself to the board of a new Chrysler company after bankruptcy. "This is a strategic deal for Fiat," Alfredo Altavilla, head of Fiat Powertrain Technologies, said. "We are here for the long run." Chrysler executive Tom LaSorda said Fiat was not contributing any cash to the deal, but it was the only option for Chrysler other than liquidation. "We couldn't bring anyone to the altar to bring us 5 cents," LaSorda said. "We were very, very fortunate we got Fiat."
