After enjoying a bit of confusion from savior Fiat about the imperative of a June 15 deadline, and a quick, 24-hour trip to the Supreme Court, Chrysler creditors now know in no uncertain terms just how much political will there is behind getting the automaker’s government-orchestrated deal done.

The top U.S. court can certainly be counted on to ponderously deliberate matters of vital importance to the nation. But when the consequences of delay are dire (thousands of auto workers’ jobs, a U.S. presidency, etc.), a decision to not make a decision can come with lightning speed.

In a brief two-page order, the justices said opponents of the Fiat-Chrysler deal had not met the burden of showing the Supreme Court needed to intervene. The court’s action was not a decision on the merits of the challenge, they said. The Chrysler dispute marked the first time the Supreme Court had been confronted by legal issues involving the federal government’s power to deal with the economic crisis.

More importantly, it showed that the mechanics working on the reconstruction of the auto industry may have one less headache to worry about as they hammer out problems at General Motors, which is using a similar quick-sale strategy in its bankruptcy in New York.

Reuters will be sending live updates from the Chrysler bankruptcy hearing, on the automaker’s plan to reject 789 dealership franchises, expected soon after 0830 ET. Read the updates below or follow us on Twitter.

What’s surprising: Talks for General Motors Corp’s Opel failed to yield a deal.

What’s not-so-surprising: GM needs cash. Again.

Talks that ran all through Wednesday night to sell Opel to one of four final bidders narrowed the race to two but failed in sealing a deal. German ministers, emerging in the early hours of Thursday morning after more than 12 hours of talks, blamed GM and the U.S. Treasury for the failure.

Why? Because GM, the ministers say, shocked participants by announcing it needed 300 million euros ($415 million) more in short-term cash from the German government to  keep Opel operating.

Italian automaker Fiat and Canadian auto parts supplier Magna remain in the race to buy Opel. Belgian private equity firm RHJ International is out. China’s Beijing Automotive Industry Corp was not present at the meeting but the option for it to return with a more detailed offer remained open.

Meanwhile, GM, which has lost $82 billion in the past four years and has received $19.4 billion in government funding since the beginning of this year.  It has also said it would likely need $7.6 billion from the U.S. Treasury after June 1. Buy GM cars or not, they sure are getting your money.

Opponents seeking to slow down Chrysler’s blitz through bankruptcy court received unexpected support for their argument on Wednesday: Chrysler’s lead attorneys. 
    An email that turned up during discovery showed that Jones Day attorneys tried to discourage the U.S. government from setting a June 15 deadline for completing a sale of most of the automaker’s assets to a group led by Fiat.
    A lawyer for a group of Indiana pension funds, which oppose the sale, read the email in court which showed Jones Day attorneys said the tight schedule would undermine the credibility of their case, called the time frame a mistake and said it would “stuff the judge” by forcing such a rapid hearing schedule.
    “The debtor lost that one,” said the Indiana fund’s attorney, Glenn Kurtz of White and Case, referring to Jones Day recommendation regarding the deadline.
    Judge Arthur Gonzalez overruled Jones Day attorneys who objected to entering the email, which the U.S. Treasury released during discovery, because it was not meant to be public and tapped into Chrysler’s legal strategy.

-By Tom Hals and Emily Chasan

Chrysler’s private equity owners Cerberus, or at least their lawyers, will arrive at bankruptcy court in Manhattan later this morning. Yesterday, President Obama assured hand-wringing industrialists that the process would be quick and efficient and that Chrysler would emerge a leaner, meaner machine.

To some degree, one can look at the U.S. airline industry in the same light. But that industry, while “saved” through bankruptcy numerous times, is today a shadow of its former self, and remains haunted every so often by the threat of a return to that business mortuary for rebirth.

But a lot has changed since the crisis mad bankruptcy court so busy. The key for the new age of court-run restructuring is to sell major assets before going to court — effectively leaving creditors to haggle over the dregs. Some disgruntled creditors contend that the quick bankruptcy promised by Obama is being engineered in such a way because the sales would never make it past a judge.

In the first major bankruptcy for the auto industry since the crisis began, Obama criticized a handful of “speculators” for greedily holding out for more taxpayer money. He praised union workers for making concessions and financial institutions, led by JPMorgan, for agreeing to take losses up front. He even praised the car company’s management.

But if you look closely, you may start to sympathize with anyone who bought a bond and is being told to settle for less to serve the common good. And to have the management of the company and its bankers praised for effectively engineering a lot of this mess might well make your eyes cross in disbelief.

Deals of the Day:

* Sumitomo Mitsui Financial Group, Japan’s third-largest bank, will buy Citigroup’s Japanese brokerage and key investment banking units in a $5.9 billion deal that will create a banking powerhouse.

* Citi execs are using the sale of its Japanese retail brokerage Nikko Cordial to ease demands from the U.S. stress tests on banks, arguing the sale of non-core assets such as Nikko would strengthen its balance sheet, the Financial Times reported, citing people close to the matter.

* General Motors will talk to the Korea Development Bank (KDB) about selling a stake in GM Daewoo, if that would help the South Korean car-making unit in the long term, a top executive said.

* Australia should veto China’s planned $19.5 billion investment in miner Rio Tinto, Australia’s main opposition Liberal Party said as political opposition to the deal continued to grow.

(PHOTO: The Chrysler logo is reflected in the rear view mirror of a vehicle on the lot at Clark Chrysler Jeep Dodge dealership in Methuen, Massachusetts April 30, 2009. )

Chrysler’s biggest lenders and the U.S. government reached a breakthrough framework deal to cut the automaker’s debt by $6.9 billion, but officials say bankruptcy is still a strong possibility with the Obama administration’s Thursday deadline for a comprehensive rescue plan just hours away.

Fiat Chief Executive Sergio Marchionne was quoted by the president of the Canadian Auto Workers union as saying Chrysler would likely enter Chapter 11 bankruptcy for a period of time. But Michigan Senator Carl Levin said, “If they do go into bankruptcy, it would really be in and out.” A source with senior-level knowledge of the restructuring told us that a surgical bankruptcy could be a way, for instance, to address “recalcitrant” lenders.

With Germany’s Daimler AG dumping its 19.9 percent stake in Chrysler and Italy’s Fiat poised to “eventually” own more than a third of the company, European know-how and innovation have never been more important for the U.S. auto industry.

Deals of the Day:

* British education and training company BPP Holdings said it had received a preliminary approach from Apollo Global at 620 pence per share in cash. The approach was at a 70 percent premium to BPP’s closing price on Tuesday valued BPP at 303.5 million pounds ($447 million).

* Australian iron ore miner Fortescue Metals has completed approvals for its equity tie-up with China’s Hunan Valin Iron and Steel Group, the company said.

* Russia’s Aeroflot may agree to buy 49 percent of troubled German airline Blue Wings, Russian Transport Minister Igor Levitin, who is also Aeroflot’s chairman, told Reuters.

* A merger between Shinsei Bank and Aozora Bank is facing difficulties as they were not able to get consent from their major shareholders, Jiji news agency reported. 

(PHOTO: A Chrysler logo is seen atop a New York City car dealership April 27, 2009. REUTERS/Mike Segar)

It may be a raucous bit of speculation gone awry, but reports in Italy that Fiat is angling to pick up General Motors’ Opel operations in Europe if the Chrysler deal falls through are too good to dismiss out of hand.

The denial from Fiat’s Chairman, Luca Cordero de Montezemolo, left a little room for intrigue in its dramatic flair. “They’ve written about it in the newspapers? No, no,” he told reporters. Fiat shares raced higher in relief. “Opel is linked to GM and Fiat has already got out of that,” said a Milan dealer, referring to a previous partnership. “Plus, it (Opel) is a clunker. Heaven forbid!”

Meanwhile, over at Chrysler, Chief Executive Bob Nardelli has been telling it like it will be. In an internal memo to staff, he said the company would cede control of its board, and ultimately senior leadership, if it completes the planned Fiat alliance. Given the Fiat deal is for only a fifth of Chrysler initially, rising eventually to 35 percent, that might seem odd. Then again, it’s the U.S. auto sector we’re talking about.

Deals of the day:

* Shares in Zurich Financial Services AG were lower after the company agreed to buy the U.S. auto insurance business of American International Group.

* Communications equipment maker Harris Corp said it agreed to buy Tyco Electronics Ltd’s wireless systems business for $675 million in cash, expanding its presence in the $9 billion market for land mobile radio systems.

* The German government’s 1.39 euro per share offer for stricken investment bank and property lender Hypo Real Estate (HRE) will run until May 4, the SoFFin financial sector rescue fund.

* British life insurer Chesnara said it had agreed to buy Swedish rival Moderna Life, and that it was on the lookout for further acquisitions in the financial services sector.

* An $87.6 million bid by a joint venture of investors Hilco Consumer Capital and Gordon Brothers Brands won the auction for the assets of bankrupt camera maker Polaroid, a federal bankruptcy judge ruled.

Christopher Kaufman; DealZone Editor

(PHOTO: A worker sweeps next to a car made from lemons and oranges during the lemon festival in Menton, southern France, February 12, 2009. REUTERS/Eric Gaillard)

Of all the shotgun weddings out there, Fiat’s proposed partnership with Chrysler is the one looking most likely to end in a gory mess. Adding to the drama — and rolling out another irresistible cliché — the whole thing is turning into a game of chicken.

With two weeks to go before Uncle Sam pulls the plug on Detroit’s third wheel, Fiat’s chief warned Chrysler’s unions that he would walk away unless they agreed to cut labor costs.

Sergio Marchionne told the Globe and Mail newspaper a deal on a partnership had only a 50-50 chance of success because of lack of progress in talks with unions. Canadian unions are especially resistant, he said.

You deal or we walk. Isn’t that what the union is supposed to say?

Deals of the Day:

* Sanofi-Aventis has agreed to buy private U.S. cancer specialist BiPar Sciences Inc. for up to $500 million in the latest bolt-on acquisition by the French drugmaker.

* British publishing group Pearson is buying Wall Street English, one of China’s top English language-training companies, for $145 million in cash to cement its position in a critical growth market.

* Italian car maker Fiat SpA will abandon partnership talks with ailing Chrysler unless unions agree to cuts in labor costs, Fiat Chief Executive Sergio Marchionne said.

* China said a review of the $1.6 billion bid by Japan’s Mitsubishi Rayon to buy unlisted British chemicals maker Lucite International was moving ahead, despite reports the deal had hit a snag.

* EBay Inc plans to spin off its Skype unit, acknowledging that the Web telephone service does not fit with the rest of the company, in an indictment of former CEO Meg Whitman’s acquisition strategy.

* Coal miner Mongolia Energy, which transformed itself from a technology company to a mining firm in 2007, is eyeing weaker rivals as possible takeover targets amid the global financial crisis.

* Lion Capital is selling a stake of up to 5 percent in bakery group Aryzta through Credit Suisse, the Swiss bank said on Wednesday.

* Kimberly-Clark said it acquired Jackson Products Inc, a privately-held safety products company, in a cash transaction.

* Nova Chemicals shareholders voted overwhelmingly in favor of Abu Dhabi-based International Petroleum Investment Corp’s $500 million takeover of the raw plastics manufacturer, which comes amid a major downturn in the petrochemical industry.

* South Korea’s Daewoo Electronics Corp is set to pick potential buyers for its non-core businesses, including TV manufacturing, by next week as it restructures to focus on appliances, its chief executive said.

* Total does not expect to increase its offer for UTS Energy, Mike Borrell, president of the French oil multi-national’s Canadian subsidiary, told the Financial Post.

* Irish Life & Permanent is considering a reorganization of its business units that could see its banking arm, permanent tsb, being spun off, the Irish Independent newspaper reported.

* India’s NMDC Ltd is in talks with African firm Kopano Ke Matla Investment Co for a joint venture that could bid for coal and iron ore mines in Africa, the chairman of the state-run miner said.

(PHOTO: Fiat CEO Sergio Marchionne smiles before he addresses the audience at the “Forum of the 100″ at the University in Lausanne May 22, 2008. REUTERS/Denis Balibouse)

In retrospect, GM CEO Rick Wagoner’s demise was perhaps the most inevitable twist in the autos overhaul saga to date. The chance that he would present a radical plan to Obama this week, one dramatic enough to save his job, was slim at best. A more shocking result, one clearly less viable for Obama, would have been to make a few more threatening noises and hand out the cash that the company so desperately needs without demanding a very public pound of flesh - a head, in this case.

With only another 60 days to effect a U-turn in defiance of a skidding market, former GM COO Fritz Henderson doesn’t have a lot of room to maneuver. It’s hardly enough time for Washington to have installed a new crash-test chief executive.

The Chrysler bailout story is more intriguing. The private-equity owned car maker has been given 30 days to do a deal with Fiat, which has in deal talks to date pledged somewhere around zero in financial support. If that price was too much for the Italian auto maker, they may think that the ticking of the clock could give them some leverage to squeeze a few billion out of either Chrysler’s private-equity owners or U.S. taxpayers.

While Fiat managers may feel like kids in a Hot Wheels factory, they should probably temper their enthusiasm. Giving a foreign car maker U.S. taxpayer dollars would probably be politically poisonous to Obama, leaving bankruptcy a more viable option for the private-equity venture.

Deals of the Day:

* Turkey’s Sabanci family is buying a 15.3 percent in German airline Air Berlin, scooping up part of Len Blavatnik’s stake, more than two months after the U.S. billionaire sold the holding.

* Chinese car maker Geely Automobile Holdings will pay up to about A$58 million ($40.22 million) for its acquisition of Australian automatic transmission supplier Drivetrain Systems International (DSI).

* Reclusive, cash-rich Russian oil firm Surgutneftegaz made its first move on foreign markets, getting a foothold in eastern Europe with a surprise deal to buy 21 percent of Hungarian oil group  MOL.

* OTE, Greece’s biggest telephone company, has agreed to sell its Macedonian mobile phone unit Cosmofon and retail chain Germanos Telekom Skopje to Slovenia’s Telekom Slovenije.

(PHOTO: General Motors Chairman and CEO Rick Wagoner addresses the media during a news conference at GM world headquarters in Detroit, Michigan February 17, 2009.  REUTERS/Rebecca Cook)

Who in the world doesn’t believe in supporting the auto business? As the U.S. Treasury contemplates the extent to which it will pump funds into the Detroit Three, European leaders are revving up measures to keep their car companies chugging along.

French President Nicolas Sarkozy said France would consider making consumer auto loans more attractive as a way to help car makers hit by the global credit crunch and slowing economy. As if his country were plagued with a reckless, cut-throat sort of capitalism, the French president declared: “We cannot be the only country in the world that does not support our builders and manufacturers. We have to help industrial infrastructure.” He’s already offered 1,000 euros to every driver who trades in an old vehicle for a less-polluting one, so softening up auto loans would seem to be right up a Parisian alley.

In Italy, Fiat’s admission last week that its car business needs a partner to survive is seen as a way to put pressure on the Italian government for a solution. While media reports cite France’s PSA Peugeot-Citroen and Germany’s BMW as potential partners, industry watchers do not see a deal any time soon. Volkswagen says its finance arm has no capital problems, but is applying for state loan guarantees nonetheless. Sweden and Canada wasted no time pledging support for their auto sectors.

Much like any driver who has found himself staring dumbfounded at a mechanic’s repair bill, governments may be grumpy, but there is no way they won’t pay up.

Deals of the day:

* Suzlon Energy, the world’s fifth-largest wind turbine maker, said it has agreed with Portugal’s Martifer to revise the payment schedule to increase its stake in Germany’s REpower.

* Unite Group, Britain’s largest provider of student housing, said it has completed a sale of assets to the Unite UK Student Accommodation Fund for 171.3 million pounds ($262 million) in cash.

* Citigroup will sell its Japanese trust bank to a unit of Mitsubishi UFJ Financial Group for around $276 million, as the struggling U.S. bank looks to sell assets worldwide.

* China’s state-run energy giant Sinopec could acquire Russian mid-sized oil firm Urals Energy for $130 million, a Russian newspaper reported.

* Telefonica and Vivendi are about to close an agreement to buy Prisa’s pay-TV platform Digital+ for 2.3 million euros ($3.1 million), Spanish radio Intereconomia reported.