U.S. Likely Taking Majority Ownership of GM

Automaker expected to announce that only a small fraction of the holders of its $27 billion in bonds agreed to swap that unsecured debt for a 10 percent equity share of a recapitalized GM.

NEW YORK (Fox News) - In the end, General Motors' massive cash needs likely trumped any chance of the automaker avoiding a bankruptcy court-supervised reorganization.

General Motors Corp. is expected to announce early Wednesday that only a small fraction of the holders of its $27 billion in bonds agreed to swap that unsecured debt for a 10 percent equity share of a recapitalized GM.

Reaching such an agreement was one of the requirements of the Obama administration, which already has committed $19.4 billion in aid and said it would only provide more funds if bondholders and unionized workers made concessions that substantially reduced GM's costs.