A bankruptcy judge said that General Motors can sell the bulk of its assets to a new company, clearing the way for the automaker to quickly emerge from bankruptcy.

US Judge Mr Robert Gerber said in his 95 page ruling that the sale was in the best interests of both GM and its creditors, whom he said would otherwise get nothing. He said that "As nobody can seriously dispute, the only alternative to an immediate sale is liquidation a disastrous result for GM's creditors, its employees, the suppliers who depend on GM for their own existence, and the communities in which GM operates."

The ruling comes after a three day hearing that wrapped up Thursday, during which GM and government officials urged a quick approval of the sale, saying it was needed to keep the automaker from selling itself off piece by piece.

Mr Fritz Henderson president & CEO of GM said in a statement that "This has been an especially challenging period, and we've had to make very difficult decisions to address some of the issues that have plagued our business for decades. Now it's our responsibility to fix this business and place the company on a clear path to success without delay."

But attorneys for some of GM's bondholders, unions, consumer groups and individuals with lawsuits against the company argued for its rejection, saying that their needs were being pushed aside in favor of the interests of GM and the government.

(Sourced from Associated Press)