Ally's $2.1 billion payment to ResCap gets court approval - Yahoo! Finance
A bankruptcy judge on Wednesday approved a settlement in which the
U.S. government-owned Ally Financial Inc (ALLY_pb.N), formerly the
finance arm of General Motors Co., will pay $2.1 billion to its bankrupt
unit Residential Capital LLC (RESC.UL).
Judge Martin Glenn also said he will unseal a report by a bankruptcy
examiner probing Ally's role in ResCap's collapse. The report had been
sealed as the parties hashed out a settlement.
The deal is a key step in ResCap's eventual exit from Chapter 11
protection. The settlement also will help Ally focus on its core
business of auto lending and on repaying the U.S. government roughly $10
billion outstanding on a $17 billion loan for a bailout during the
financial crisis.
The agreement still must be incorporated into a formal plan by
ResCap charting its bankruptcy exit strategy, which will also need court
approval.
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