LONDON (MarketWatch) -- General Motors Corp. Chairman and Chief Executive Rick Wagoner is resigning from his leadership of the troubled automaker at the request of the Obama administration.
Wagoner's departure is part of the restructuring agreement between GM (GM:2.86, -0.76, -21.0%) and the U.S. government, which will clear the way for the company to receive further federal loans.
Chief Operating Officer Frederick "Fritz" Henderson will serve as CEO until a permanent replacement is found, with longtime director Kent Kresa serving as interim chairman.
"On Friday I was in Washington for a meeting with Administration officials. In the course of that meeting, they requested that I 'step aside' as CEO of GM, and so I have," Wagoner said in a statement.
"Fritz Henderson is an excellent choice to be the next CEO of GM. Having worked closely with Fritz for many years, I know that he is the ideal person to lead the company through the completion of our restructuring efforts," he added.
Kresa meanwhile signaled new directors will be named.
"The board intends to work to nominate a slate of directors for the next annual meeting that will include a majority of new directors taking into account the addition of new directors, retirement, and decisions by individual directors not to stand for re-election, although the specific individuals who will be nominated or choose not to run or leave the board are not yet known."
The ousting of Wagoner came as Obama administration officials said the government will give GM and fellow automakers Chrysler LLC enough capital to work with stakeholders to craft more aggressive strategies but warned that a "quick and surgical" bankruptcy may be each company's best chance for survival. Read full story on administration's findings from GM, Chrysler.
GM already has received approximately $13.4 billion in Treasury loans and said in February it needs up to $16.4 billion in additional aid.
GM shares slumped 12% in pre-market trade.
Separately, Dow Jones Newswires and The Wall Street Journal said that Chrysler LLC Chief Executive Robert Nardelli is unlikely to meet the same fate as Wagoner.
But The Wall Street Journal reported that the government plans to provide Chrysler with capital for 30 days to cut a workable arrangement with Fiat SpA (IT:F: news , chart , profile ) , the Italian auto maker that has a tentative alliance with Chrysler.
Well I don't think this is the gov't's place, but then again...if you take gov't money, you gotta expect this sort of thing. File for bankrupcy already!
In for a penny, in for a pound. This is actually one of the things that I want the gubbmint to do if it continues to decide to prop up failed companies. Of course, in the end it doesn't matter much either way.
I've never met a retarded person who wasn't smiling.
