The bondholders rejected an offer of $324 for every $1000 they were owed.
"In any kind of liquidation scenario, they would get nothing or something unbelievably small," said the source.
It's really too bad GM, a company that has been in business since 1908- 101 years is on the brink of bankruptcy.
I came across this tidbit in wiki:
"General Motors is the best selling foreign auto maker in China. The Buick brand is especially strong, led by the Buick Excelle subcompact. Cadillac initiated sales in China in 2004, starting with imports from the United States. GM pushed the marketing of the Chevrolet brand in China in 2005 as well, moving the former Buick Sail to that marque. The company manufactures most of its China-market vehicles locally, through its Shanghai GM joint venture. Shanghai GM, a joint venture between the Chinese company SAIC and General Motors, was created on March 25, 1997. The Shanghai GM plant was opened December 15, 1998, when the first Chinese-built Buick came off the assembly line. The SAIC-GM-Wuling Automobile joint-venture is also successful selling trucks and vans under the Wuling marque (34% belongs to GM).
GM plans to create a research facility in Shanghai for $250m to develop hybrid cars and alternative energy vehicles. This move has been criticized because it pushes outsourcing to the very limit."
High Stakes GM: Instead, the government will convert that debt into a 72.5% stake in the new company. This means that for taxpayers to make back any of the money loaned to GM, it will have to be because shares of the new GM increase in value following an exit from bankruptcy.
* Various CNN news articles were used for the reference info.