GM to sell Hummer; gets court nod for vehicle protection and incentive programmes

02 June 2009

General Motors Corp on Monday announced that it has entered into a memorandum of understanding (MoU) with a buyer for the Hummer SUV, its premium off-road brand.

GM said it expects the sale to close by the end of third quarter of this year, subject to customary closing conditions, including receipt of applicable regulatory approvals. It did not disclose the name of the buyer.

The transaction would secure over 3,000 US jobs in manufacturing, engineering and at Hummer dealerships in the country, it said, adding The investor has agreed to make aggressive investments in hummer.

GM said it has received US bankruptcy court approval to continue honoring all vehicle warranty programmes and dealer incentive plans. The court also granted approval for GM to access a new approximately $33.3 billion debtor-in-possession (DIP) financing facility from the US Treasury and the Canadian and Ontario governments.

The court authorised GM to use up to $15 billion of the facility on an interim basis pending a final order approving the full facility. This credit facility will be used, among other things, for the company's normal liquidity requirements, including employee wages, healthcare benefits, supplier payments, and other operating expenses.

GM said it intends to make payment for goods received and services provided to it on or after the filing date in the normal course of business and in accordance with terms of existing supplier agreements.