DETROIT (Reuters) –
The board of General Motors Corp (GM.N) met on Sunday to review a restructuring plan intended to cut costs and win support for up to $12 billion in emergency funding from the government, a person familiar with the deliberations said.

Along with rivals Ford Motor Co (F.N) and Chrysler LLC, GM is rushing to complete the business plans demanded by Congress as a condition of considering a $25-billion rescue package for the embattled industry.

A GM spokesman said the automaker does not comment on board meetings as a matter of policy. "We are moving ahead toward delivering the plan," GM spokesman Tom Wilkinson said.

Privately held Chrysler, which is owned by Cerberus Capital Management, said on Sunday its board would also convene to review its revised turnaround plan ahead of Tuesday's deadline for submission to lawmakers.

"Chrysler is fine-tuning its original plan to meet the recent request from congressional leadership," Chrysler spokeswoman Lori McTavish said. "The company's board will be part of the final review process leading up to Tuesday's submission."

Ford spokesman Mark Truby declined to comment on when the automaker's board would review the plans it will submit to Congress.

The GM board meeting came on the same day that United Auto Workers president Ron Gettelfinger signaled his union was prepared to offer further concessions in order to win support for the bailout provided management shared in the sacrifice.

"They need to establish that executive compensation is something that they're willing to curtail," Gettelfinger said in an interview on CNN. "They can also give the government an equity stake in the business."

The automakers met with skepticism from key lawmakers at hearings earlier in November and were widely criticized for flying to Washington in corporate jets.

House and Senate Democratic leaders, in a letter to GM, Ford and Chrysler executives, said the companies demanded that each submit a "credible restructuring plan" by Tuesday.

That is the same day that major automakers are expected to report bleak November sales results that show an only limited bounce from October when the consumer uncertainty and tight credit combined to send sales to 25-year lows.

NOVEMBER SALES SEEN BLEAK

November sales are expected to show the auto industry running at a U.S. sales rate of about 11 million vehicles on an annual basis, down by almost a third from 2007's tally.

Analysts see a chance for GM to stop burning cash if the industry recovers back above a sales rate of about 13 million vehicles and it succeeds with a stepped-up restructuring backed by federal funding in a deal that would involve steep concessions from creditors, executives and the UAW.

The union is under pressure to surrender protections that allow laid-off factory workers at the Detroit automakers to collect over 90 percent of their pay by shifting to a jobs bank. The union agreed to restrictions on the program.

A potentially more important concession would be winning new terms for payments by GM and other automakers into a $48 billion trust fund scheduled to take over funding health care benefits for retired autoworkers from 2010.

The revised plan GM is set to submit to Congress is also expected to show cuts to executive pay. The automaker paid its top executives more than $40 million in 2007, even as its stock dropped 19 percent and it posted a loss of $39 billion.

In addition, the GM plan is expected to indicate that the company will ask some bond holders to accept equity and a limited cash payout to redeem the debt they hold.

That proposed debt swap is seen as crucial because GM has more than $44 billion in debt on its balance sheet, analysts have said.

The automaker burned through $6.9 billion in the past quarter and ended September with $16.2 billion. It needs a minimum of between $11 billion and $14 billion to operate and pay suppliers and has warned it could fall short of cash early next year without government help.

The revised plans from all three Detroit automakers are expected to focus on their investment in fuel-saving technology and alternatives like GM's battery-powered Chevrolet Volt.

Analysts expect the automakers to detail confidential product plans that show they have a game plan for meeting federal requirements for a 40-percent improvement in fleet-wide average fuel economy to 35 miles per gallon by 2020.

Beyond that, there are separate considerations for Ford and Chrysler as their CEOs prepare to head back to Washington.

Ford is in a stronger financial position than its rivals and has suggested it would prefer to have a line of credit from the government. That would allow Ford to sidestep the issue of control of the No. 2 U.S. automaker for now.

The Ford family holds just under 3 percent of the automaker's shares but controls 40 percent of the voting power under a separate class of shares that could be endangered by a government equity stake in the automaker.

For its part, Chrysler's owner Cerberus has indicated that it needs both an alliance with GM and Ford or other automakers in addition to federal funding to survive the downturn.

LONDON (Reuters) –
The prospects of Swiss drugmaker Roche (ROG.VX) raising a $45 billion syndicated loan to finance the buyout of the rest of U.S. biotech group Genentech (DNA.N) are becoming increasingly remote.

The sheer size of the jumbo deal would eclipse today's shrinking loan market -- a fact which senior banking sources say is putting pressure on Roche to consider alternative funding options. These could be a combination of loans, bonds, equity and cash.

"The question is about size. In light of the current climate, a $45 billion loan looks large. It would have to be a combination of everything -- Roche would have to print bonds to get the deal done," a senior banker close to the deal said.

Roche reiterated on November 25 that it remained committed to its $43.7 billion bid to acquire the 44 percent of Genentech it doesn't already own.

The company has been talking to banks about a jumbo loan since July and has repeatedly said that it is confident of getting the financing in place to back the purchase, despite deteriorating market conditions.

The exact size of the loan that Roche has been seeking was never finalized, but senior bankers said that the company was discussing a $45 billion figure.

Banks, however, are not underwriting any new loans before the end of the year and the drive to deleverage their balance sheets is expected to continue well into 2009, which means that the days of mega-loans are over.

"$45 billion was always right out there, it was the top of the market even in the good old days and I just don't see that number being attainable any time soon," one head of loan syndications said.

BHP LOAN Canceled

Speculation that the cancellation of BHP Billiton's (BHP.AX) $55 billion loan last week -- after it dropped plans to take over Rio Tinto (RIO.AX) -- might aid Roche's chances of securing a huge loan was dismissed by bankers.

"The release of BHP's capital doesn't make Roche more viable. You would be replacing one problem with another -- a big funded asset that you can't sell. It's not a credit issue; it's a bank balance sheet issue," the syndicate head said.

Roche has significant capital resources with more than 10 billion Swiss francs of net cash on its own balance sheet at June 30. This, along with cash on Genentech's balance sheet and Roche's own cashflow could further reduce the amount of debt to raise, bankers said.

However, the amount of debt that could be refinanced in the corporate bond market would be the key to any possible deal, they added.

The corporate bond market has recently re-opened but issuance remains patchy and expensive going into the end of the year, which is leaving bankers to speculate that any deal could be some way off.

"For the moment, there are no real developments -- it's in abeyance -- but this is a very good and highly rated company in a good industry with a strong bank group," the senior banker close to the deal said.

Roche argues that bringing Genentech into the corporate fold will give it a stronger and more effective market presence, and generate annual pretax cost synergy benefits of about $750-$850 million.

It would gain control of all revenues for big-selling Genentech cancer drugs Avastin and Herceptin, as well as absorbing an attractive portfolio of new medicines.

Initially, investors viewed the acquisition as done deal and many bet Roche would increase its $89 a share offer to win over the Genentech board.

But since the worsening the credit crisis entered a new phase in September doubts have grown about the acquisition and Genentech shares have fallen a premium to a discount to the Roche offer.

"It doesn't feel right in this environment," said one senior industry consultant.

(Additional reporting by Ben Hirschler; Editing by Richard Hubbard)

DETROIT (Reuters) –
The board of General Motors Corp (GM.N) met on Sunday to review a restructuring plan intended to cut costs and win support for up to $12 billion in emergency funding from the U.S. government, a person familiar with the deliberations said.

Along with rivals Ford Motor Co (F.N) and Chrysler LLC, GM is rushing to complete the business plans demanded by Congress as a condition of considering a $25-billion rescue package for the embattled industry.

A GM spokesman said the automaker does not comment on board meetings as a matter of policy. "We are moving ahead toward delivering the plan," GM spokesman Tom Wilkinson said.

Privately held Chrysler, which is owned by Cerberus Capital Management, said on Sunday its board would also convene to review its revised turnaround plan ahead of Tuesday's deadline for submission to lawmakers.

"Chrysler is fine-tuning its original plan to meet the reset requiet from congressional leadership," Chrysler spokeswoman Lori McTavish said. "The company's board will be part of the final review process leading up to Tuesday's submission."

Ford spokesman Mark Truby declined to comment on when the automaker's board would review the plans it will submit to Congress.

The GM board meeting came on the same day that United Auto Workers president Ron Gettelfinger signaled his union was prepared to offer further concessions in order to win support for the bailout provided management shared in the sacrifice.

"They need to establish that executive compensation is something that they're willing to curtail," Gettelfinger said in an interview on CNN. "They can also give the government an equity stake in the business.

The automakers met with skepticism from key lawmakers at hearings earlier in November and were widely criticized for flying to Washington in corporate jets.

House and Senate Democratic leaders, in a letter to GM, Ford and Chrysler executives, said the companies demanded that each submit a "credible restructuring plan" by Tuesday.

That is the same day that major automakers are expected to report bleak November sales results that show an only limited bounce from October when the consumer uncertainty and tight credit combined to send sales to 25-year lows.

NOVEMBER SALES SEEN BLEAK

November sales are expected to show the auto industry running at a U.S. sales rate of about 11 million vehicles on an annual basis, down by almost a third from 2007's tally.

Analysts see a chance for GM to stop burning cash if the industry recovers back above a sales rate of about 13 million vehicles and it succeeds with a stepped-up restructuring backed by federal funding in a deal that would involve steep concessions from creditors, executives and the UAW.

The union is under pressure to surrender protections that allow laid-off factory workers at the Detroit automakers to collect over 90 percent of their pay by shifting to a jobs bank. The union agreed to restrictions on the program

A potentially more important concession would be winning new terms for payments by GM and other automakers into a $48 billion trust fund scheduled to take over funding health care benefits for retired autoworkers from 2010.

The revised plan GM is set to submit to Congress is also expected to show cuts to executive pay. The automaker paid its top executives more than $40 million in 2007, even as its stock dropped 19 percent and it posted a loss of $39 billion.

In addition, the GM plan is expected to indicate that the company will ask some bond holders to accept equity and a limited cash payout to redeem the debt they hold.

That proposed debt swap is seen as crucial because GM has more than $44 billion in debt on its balance sheet, analysts have said.

The automaker burned through $6.9 billion in the past quarter and ended September with $16.2 billion. It needs a minimum of between $11 billion and $14 billion to operate and pay suppliers and has warned it could fall short of cash early next year without government help.

The revised plans from all three Detroit automakers are expected to focus on their investment in fuel-saving technology and alternatives like GM's battery-powered Chevrolet Volt.

Analysts expect the automakers to detail confidential product plans that show they have a game plan for meeting federal requirements for a 40-percent improvement in fleet-wide average fuel economy to 35 miles per gallon by 2020.

Beyond that, there are separate considerations for Ford and Chrysler as their CEOs prepare to head back to Washington.

Ford is in a stronger financial position than its rivals and has suggested it would prefer to have a line of credit from the government. That would allow Ford to sidestep the issue of control of the No. 2 U.S. automaker for now.

The Ford family holds just under 3 percent of the automaker's shares but controls 40 percent of the voting power under a separate class of shares that could be endangered by a government equity stake in the automaker.

For its part, Chrysler's owner Cerberus has indicated that it needs both an alliance with GM and Ford or other automakers in addition to federal funding to survive the downturn.