On cusp of GM IPO, senator seeks more for retirees

CLEVELAND (Reuters) - Senator Sherrod Brown of Ohio, a Democrat who supported the General Motors bailout, said on Tuesday he will meet with the automaker’s incoming chief executive to renew a push for better pensions for retirees from the company’s former parts unit, Delphi.

Senators' Charles Schumer (D-NY), (L), Sherrod Brown (D-Ohio), (C), and Bob Menendez (D-NJ), (R), present a report on Capitol Hill in Washington, April 11, 2007. REUTERS/Larry Downing

General Motors Co is readying the filing of an IPO, but Brown and other lawmakers say it is not too late to reverse a decision made last summer as GM restructured with the help of a government-sponsored bankruptcy. The U.S. Treasury owns 61 percent of GM.

“What are they going to do for the Delphi retirees who weren’t treated fairly by their company,” said Brown. “I’m still hopeful. I’ve had conversations with two GMs CEOs in a row, and I will have one with this one.”

Dan Akerson, appointed to the GM board last summer by the Obama administration, takes over as CEO on September 1.

Salaried Delphi retirees protested when GM agreed to offset pension funding shortfalls for unionized workers but not for salaried Delphi retirees. Privately held Delphi, once a unit of General Motors, emerged from a four-year bankruptcy last fall.

Plans made by an auto parts company under bankruptcy restructuring can be changed, as shown on Tuesday. In a suit brought by retired workers of Visteon Corp, a federal appeals court said the company had to increase the number of retirees receiving health and life insurance benefits.

Visteon, the former auto parts unit of Ford Motor Co, sought bankruptcy protection in 2009.

The IPO is expected sometime between late October and the U.S. Thanksgiving holiday in late November, so that the automaker’s first trades will come right around the time of U.S. midterm congressional elections.

Brown made his comments at a manufacturing round-table in downtown Cleveland that was also attended by Ron Bloom, the Obama administration official overseeing the government’s investment in GM and Chrysler Group LLC.

Bloom declined to comment on the expected GM IPO.

But two Democratic politicians present who seek re-election in November hailed the restructuring of GM and Chrysler and an expected GM IPO as a triumph for the Obama administration.

“The Obama administration and my Democratic friends in Congress should feel very good that they saved this industry,” Ohio Governor Ted Strickland told Reuters in an interview.

“Had it not been for the president’s leadership, GM may not exist today and Ohio would be in a heap of trouble,” said Strickland.

Congresswoman Betty Sutton, who represents a district in northern Ohio, said of the GM IPO, “It’s a good step. It’s another sign of prosperity.”

Bloom, without addressing the auto bailouts of GM and Chrysler specifically, told the group of manufacturing executives that the federal government should help boost manufacturing, which Brown said now contributes about 11 percent of the U.S. gross domestic product, when a few decades ago it was 33 percent of the GDP.

“The role of government is to look carefully at the aggregate of the economy, in particular in my case manufacturing, and to ask ourselves, where is the market falling short and where must government step in in order to set the seeds in order to create the conditions so that private actors can do what they need to do which is to create the wealth that creates that sustainable prosperity,” Bloom said.

Reporting by Bernie Woodall; Editing by Steve Orlofsky