The Obama administration extracted deep concessions from holders of Chrysler's $6.9bn debt yesterday, buying time for the troubled US carmaker to agree a survival plan.
The four principal lenders, which hold about 70 per cent of the debt, agreed it should be swapped for $2bn in cash, paving the way for a heavily restructured Chrysler, part-owned by Fiat, the Italian carmaker.
Two Fiat executives told the Financial Times yesterday they expected the Italian carmaker to sign a partnership with Chrysler on April 30, the US government's deadline to strike a restructuring deal with the United Auto Workers union and creditors and agree an alliance with Fiat. One person familiar with the talks was “cautiously optimistic” that a deal would be concluded with Fiat.