I know that their stock will be pretty much worthless, but of they claim chapter 11 will their current stock holders be able to keep their stock? or does it all fritter away? cause i think that GM should claim chapter 11 so they can restructure, and then they may be able to be profitable in the future, a long way into the future but still.
If you think about it, when a company emerges from chapter 11, it is actually a new company. None of the old stock and bonds are tied to this new company, and they are therefore worthless. Some of the old bondholders may be able to get some value from the new company based on what agreements are made, but stockholders are out of luck. That company in which you invested no longer exists, and a new one has taken its place, with its own (different) stock.
