UPDATE 4-With good assets sold, 'New GM' exits bankruptcy

(For other Reuters stories on GM's exit from bankruptcy,
please double-click on [ID:nCARS1], [ID:nN10512224] and
[ID:nLA641777])

* U.S. gov't signs deal to end GM bankruptcy

* GM cuts management layers, announces tie-up with eBay

* GM CEO says 'business as usual' is over

* Ford shares up 1.4 percent
(Adds comments from CFO, Ford share price, other details)

By Kevin Krolicki and David Bailey

DETROIT, July 10 (Reuters) - A new General Motors
GMGMQ.PK emerged from bankruptcy protection on Friday -- far
more quickly than most industry-watchers had expected -- as a
leaner automaker pledging to win back American consumers and
pay back taxpayers.

A whirlwind 40-day bankruptcy for GM concluded with the
closing of a deal that sold key operations to a new company
that is majority-owned by the U.S. Treasury.

The closing documents were signed early Friday by
representatives of the government and GM executives at the law
firm of Weil, Gotshal & Manges, GM's bankruptcy counsel.

The development, which follows a similar fast-track
reorganization of Chrysler, represented a victory for the Obama
administration and its commitment to save jobs and prevent a
liquidation of the largest U.S. automaker.

At the same time, the U.S. government has taken on
substantial new risks as a 60 percent owner of the new GM with
a $50 billion equity investment and $10 billion in debt and
perpetual preferred shares.

Analysts said the government intervention had given GM a
new chance and sharply lower operating costs but left
management facing deep challenges given the weak economy and
GM's long-running slide in market share.

"I wouldn't really call it a new GM, it is just a smaller
GM. That would be more of an apt description. They still have a
lot of hurdles to jump," said Mirko Mikelic, portfolio manager
at Fifth Third Bank. "Right now, they are in a survival mode."

Chief Executive Fritz Henderson said the new company would
shed layers of management, make decisions faster and shed the
bureaucracy that critics say contributed to the failure of the
100-year-old automaker.

The company's white-collar workforce will be cut by more
than 20 percent by eliminating 6,000 jobs. Executive ranks will
be cut 35 percent.

"The bottom line is that business as usual -- and as we
have had it until today -- is over," Henderson told reporters
at GM's Detroit headquarters. "Everyone associated with GM must
be prepared to change -- and fast."

Bankruptcy slashed GM's debt and healthcare obligations and
brought down labor costs to be on par with Japanese competitors
led by Toyota Motor Corp. (7203.T)

Analysts said that gives GM a chance to deliver on its
commitment to launch more fuel-efficient cars and to focus its
resources on fewer brands, models and dealerships.

"The legacy costs are gone. The challenge in the future is
how to approach a marketplace that has been burned by GM," said
Pete Hastings, senior vice president and fixed-income analyst
at Morgan Keegan.

While key assets and the Chevrolet, Cadillac, Buick and GMC
brands were sold out of bankruptcy to form the new General
Motors Company, other assets, including shuttered factories,
remain in bankruptcy for a liquidation process.

That old GM, which will become Motors Liquidation Co, is
expected to stay in bankruptcy for years.

Bondholders, who had been owed $27 billion, could
eventually receive a 10 percent stake in the new GM.

The U.S. Treasury will own 60.8 percent and 11.7 percent
will be owned by the governments of Canada and Ontario. A
retiree trust fund affiliated with the United Auto Workers
union will hold 17.5 percent.

GM will start to pay back its debt to the U.S. Treasury,
which it owes by 2015, as soon as possible, Chief Financial
Officer Ray Young told Reuters Television in an interview.

The automaker plans an initial public offering as soon as
2010 and could use some of the proceeds from that stock sale to
repay government debt, Young said.

NEW GM, NEW CULTURE?

Henderson, who took over as CEO when predecessor Rick
Wagoner was ousted by the Obama administration at the end of
March, said the company would be run by a single executive
committee, cutting the number of top decision-makers in half.

GM also eliminated the North American executive team
overseeing operations in its troubled home market which had
caused the automaker to lose more than $80 billion since 2005.

Nick Reilly, who has headed Asian operations, will take
control of GM's international operations based in Shanghai, a
recognition of the growing importance of China at a time when
GM is selling its European unit, Opel.

Bob Lutz, 77, GM's outspoken and high-profile former
product chief, agreed to stay on in a new position with
responsibility for marketing, communications and a continued
role in vehicle design.

Dennis Virag, an analyst at Automotive Consulting Group,
said Henderson would be judged by GM's new board and others on
his success in reforming a corporate culture that was blamed
for having stymied innovation and bred inefficiency.

"Does he have the habits of the old GM or is he capable of
providing the new leadership? I think he has to demonstrate
that," he said of Henderson.

Chrysler exited bankruptcy a month ago after blazing a
precedent-setting trail for GM by following an asset sale plan
that gave operational control of the smaller automaker to
Italy's Fiat SpA (FIA.MI).

GM rival Ford Motor Co (F.N) has avoided seeking emergency
U.S. government loans and Chief Financial Officer Lewis Booth
told Reuters on Thursday that the automaker remains focused on
improving its balance sheet by "somewhat less extreme methods
than going through bankruptcy."

The new GM will have slashed its debt and healthcare
obligations by $48 billion, dropped almost 40 percent of the
dealers from an unprofitable network and moved to sell laggard
brands such as Saab, Saturn and Hummer.

GM stock, which now represents an ownership interest in
Motors Liquidation, rallied 38 percent on Friday to $1.15. GM
has said the equity is expected to have no recovery and Young
said Friday he was concerned that the stock continued to trade
at such levels.

Ford shares were up 8 cents or 1.4 percent at $5.71 on the
New York Stock Exchange on Friday afternoon. The stock has
nearly tripled since hitting a low in early February.
(Reporting by Kevin Krolicki; Additional reporting by Caroline
Humer and Jui Chakravorty Das; Editing by Patrick Fitzgibbons,
Lisa Von Ahn and Matthew Lewis)