Chrysler creditors reject debt demand

Chrysler’s creditors, led by JPMorgan Chase and Citigroup, on Tuesday rebuffed a US government request to forgive the bulk of their debt holdings, a move that will prolong the stand-off over the carmaker’s future. After days of talks with banks, creditors, who hold $6.9bn in Chrysler’s debt, proposed reducing their debt to about $4.5bn and taking a stake of about $1bn in preferred equity in Chrysler following its planned alliance with the Italian carmarker Fiat.