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Chrysler's Sale, On as Planned

The sale of Chrysler's assets to Fiat will continue, despite the opposition of several parties, including dealers, lenders and state or retiree pension funds. Today, a bankruptcy court rejected the motions submitted by a pair of Indiana state pension funds and a state construction fund, Detroit News reported.

The judge rejected the motion saying that the attempt to challenge the legality of the sale in another court isn't a good enough reason to push back the proceedings. Judge Arthur Gonzalez said the lawyers representing the funds didn't manage to stress enough the damages the funds will suffer should the sale proceed.

The funds which raised the objections were Indiana State Teachers Retirement Fund and Indiana State Police Pension Trust, together with the Indiana Major Moves Construction Fund. Now, the funds plan to challenge the legality of the sale in a U.S. District Court.

"It's not just any old bank that's funding these transactions, it's the U.S. government," Thomas Lauria, an attorney representing the funds was quoted as saying by the source. He added that the challenge is required due to the involvement of the Obama administration in the matter.

Chrysler won its case, for now, by emphasizing how much a delay would harm the company. The manufacturer also said that the issues the funds had raised could have been dealt with outside the court.

Chrysler also scored another victory, as it got the court's approval to tap into the $4.96 billion in government loans needed to maintain operations. In addition, the US will lend Chrysler $600 million to cover losses incurred by GMAC Financial Services and $260 million to replace the funds transferred to its Canadian operations.
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About the author: Daniel Patrascu
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Daniel loves writing (or so he claims), and he uses this skill to offer readers a "behind the scenes" look at the automotive industry. He also enjoys talking about space exploration and robots, because in his view the only way forward for humanity is away from this planet, in metal bodies.
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