GMAC LLC chairman J. Ezra Merkin confirmed that he is resigning, effective Friday, after the auto lender converted to a bank holding company to become eligible for government funds through the Treasury Department's Troubled Asset Relief Program.
Conditions of the Treasury's $6 billion bailout of GMAC include that the company appoint an independent chairman and a reconstituted board.
During the transition to a new board, which must be completed by March 24, Merkin will be replaced as chairman by Lenard Tessler, managing director and co-head of private equity at Cerberus Capital Management LLC, and the vacant seat will be filled by Jeffrey L. Lomasky, Cerberus' chief financial officer.
GMAC's new seven-member board will consist of its chief executive, one representative from FIM Holdings LLC, two directors appointed by a trust to be formed by the Treasury and three independent directors elected by those directors. In addition, General Motors Corp. and FIM Holdings each are entitled to have one nonvoting observer on the board, as long as they hold common interests of GMAC.
Merkin, a nominee of Cerberus, runs Gabriel Capital Corp. funds, which were hard hit by the alleged Bernard Madoff Ponzi scheme.
GMAC is the financing arm of General Motors, which sold 51% of GMAC to Cerberus in 2006.