Ex-AT&T boss Whitacre to be chairman of the ‘New GM’

THE GM BANKRUPTCY


Jesse Snyder

Automotive News | June 9, 2009 – 10:42 am EST

 

Ex-AT&T boss Whitacre to be chairman of the ‘New GM’
 

Edward Whitacre Jr., former chairman and CEO of telecommunications giant AT&T Inc., today was selected to become chairman of the new General Motors when the automaker emerges from bankruptcy.

GM’s interim chairman, Kent Kresa, announced the change and said he will continue to serve until the launch of the new company, which he expects will be sometime this summer.

Both Whitacre, 67, and Kresa will serve on the new GM board, along with current board members Philip Laskawy, Kathryn Marinello, Errol Davis Jr., E. Neville Isdell and CEO Fritz Henderson.

Six other current GM board members will retire no later than the U.S. Bankruptcy Court’s approval of the sale of assets from the old GM to the new GM, the company said. A selection process is under way for four new board members while two others will be named by the Canadian government and the UAW Voluntary Employees’ Beneficiary Association, bringing the size of the new board to 13.

Whitacre was chairman and CEO of AT&T and its predecessor companies from 1990 to 2007, a period marked by a series of mergers and acquisitions. He serves on the boards of ExxonMobil Corp. and Burlington Northern Santa Fe Corp. Whitacre holds a degree in industrial engineering from Texas Technological University.

A ‘complete reinvention’

Interim Chairman Kresa called Whitacre’s appointment “a very auspicious beginning” for the post-bankruptcy automaker.

“We look forward to working with him to complete the reinvention of GM and maximize the enormous potential of this new enterprise,” Kresa said in a statement.

In a statement, Whitacre said: “I am honored to be able to serve GM at this critical juncture and take part in its reinvention.”

Whitacre would be the second retired CEO to chair GM since Rick Wagoner resigned under intense pressure March 31. Kresa, 71, retired in 2003 after 13 years as chairman of Northrup Grumman Corp., having turned a marginal defense contractor with revenue of $5 billion into a $28 billion operation with 120,000 employees.

GM filed for Chapter 11 protection on June 1 in U.S. Bankruptcy Court in New York. The Obama Administration’s plan is to support GM with a total of $50 billion in federal loans while working to help GM emerge from bankruptcy as quickly as possible.

GM has asked the court for permission to sell its best assets to a new company that would emerge from bankruptcy as the new GM while most liabilities would remain in the old legal entity that would be wound down over time.

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