Last minute attempt to stop alliance
8 June 2009

A group of Chrysler investors has made a last ditch attempt to block an alliance with Fiat.

An appeals court approved the sale of most of Chrysler’s assets to Fiat, the US and Canadian governments, and a United Auto Workers healthcare trust, on Friday.

But a temporary halt on the sale until 4pm today has been agreed, reports the Financial Times, to allow three Indiana pension funds to file an emergency appeal to the US Supreme Court.

It is thought a referral is unlikely and the only possible alternative to the Fiat deal would be liquidation.

"You can't wait for a better deal to come in from [former Indiana-based carmaker] Studebaker," an appeals court judge told the Indiana funds. The funds are understood to hold $42m (£26m) of Chrysler's $6.9bn in secured debt.

The fund holders said in their Supreme Court application that without a stay, "the court will be deprived of the opportunity to decide critical, nationally significant legal issues relating to management of the economy by the US government."

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