EXCLUSIVE - GM readies all-equity offer for debt-sources

DETROIT/NEW YORK, April 17 (Reuters) - The Obama administration has directed General Motors Corp GM.N to prepare a new debt restructuring plan that would convert all of the $48 billion the automaker owes bondholders and its major union into equity, people briefed on the plan said on Friday.

The U.S. Treasury, which has provided $13.4 billion in emergency funding to keep GM operating since the start of the year, has indicated that it could also convert those taxpayer-backed loans into GM stock, the sources told Reuters.

GM plans to make the new proposals to bondholders and the United Auto Workers union within the next two weeks, the sources said.

The sources asked not to be identified because of the confidential nature of the talks between GM and members of the autos task force appointed by President Barack Obama to oversee a retooling of the American auto industry.

Representatives of GM and the Treasury Department could not be reached for comment.

The proposals emerged after two weeks of intense discussions between members of the autos task force headed by former investment banker Steve Rattner and GM executives in Detroit. (Reporting by Soyoung Kim and Emily Chasan)