GM restructuring may make bonds best bet: Barron's

NEW YORK (Reuters) - A forced restructuring at General Motors Corp (GM.N) could make the U.S. automaker's debt appealing, according to weekly business newspaper Barron's in its December 22 edition.

The report said that under a U.S. government bailout, which requires the automaker take steps to ensure its viability, GM may renegotiate some debt and trim pay and benefits for its unionized autoworkers. The report cited employee costs as hurting bondholders and shareholders in the past.

"There could be value in GM bonds if the company restructures," said the report. Still, there are risks, especially if there was a future bankruptcy, which could drastically lower any recovery value.

GM unsecured debt rallied on Friday after GM and Chrysler LLC CBS.UL were extended a $17.4 billion lifeline by the United States. Rival Ford Motor Co (F.N) said it did not at this time need federal funds.

(Reporting by Lilla Zuill)