General Motors, the fallen icon of American industrial might, has filed for Chapter 11 bankruptcy protection as part of an Obama administration plan to shrink the automaker to a sustainable size and give a majority ownership stake to the federal government.

The bankruptcy deal that will give taxpayers a 60 percent ownership stake and expand the government’s reach into big business.

Underscoring the government’s extraordinary role, President Barack Obama planned to announce his support for GM’s restructuring strategy at a midday appearance at the White House, much as he did in April when Chrysler sought court protection.

GM president and CEO Fritz Henderson planned to hold a press conference in New York immediately following Obama’s announcement.

Administration officials said late Sunday the federal government would pump $30 billion dollars into GM as it makes its way through bankruptcy court. That’s besides the $20 billion in taxpayers’ money that the Treasury already lent to the automaker.

The money would come from what remains of the $700 billion rescue fund for the financial sector.

For the foreseeable future, General Motors will not be a publicly-held company. As of 9:30 a.m., GM stock will essentially be worthless, reports CBS News business producer Guy Campanile.

The reorganization plan aims to make GM profitable in a U.S. car market of 10 million units sold per year. The U.S. market is currently on a 9 million unit sales pace. At its peak, the U.S. market sold 16 million units, Campanile reports.

The bankruptcy papers will include a list of 11 plants that will be closed and three that will be idled. 21,000 more jobs will be eliminated. GM will also outline additional dealership cuts.

The officials, speaking on condition of anonymity in advance of Obama’s public remarks, said the administration expects the court process to last 60 to 90 days. If successful, GM will emerge as a leaner company with a smaller work force, fewer plants and a trimmed dealership force. The company will stick with its four core brands – Chevrolet, Cadillac, Buick and GMC.

The government’s ownership stake and huge financial injection represents yet another remarkable intervention into the American private sector. The Treasury has stepped in to help banks, it has taken majority ownership in insurance conglomerate American International Group and it has guided Chrysler through bankruptcy protection proceedings.

Despite its sizable ownership, administration officials said the government intends to stay out of day-to-day management decisions. It says it intends to shed its ownership stakes “as soon as practicable.”

One senior administration official insisted that “there is no plan of any kind for further support beyond this point.”

The plan will be filed under section 363 of the U.S. bankruptcy code. The 363 filing allows GM to spin a new debt-free company quickly out of bankruptcy. It’s basically the “Chrysler Plan.”

Still, it was the Obama administration that instructed GM to trim itself to a point that it could break even by selling 10 million cars a year. Its current break even point is 16 million cars.

President Obama is expected to comment from the White House on the filing shortly before noon.

It would be the largest industrial bankruptcy in U.S. history, and the fourth-largest overall. In addition, a GM bankruptcy would be unprecedented as the federal government would pump billions more into the company, and take a 72.5 percent interest in the automaker.

On Sunday a group of large, institutional bondholders, representing 54 percent of GM bondholders, agreed to exchange their unsecured bonds for a 10 percent stake in a newly restructured company, plus warrants to purchase a greater share later. They had balked at an earlier offer, that gave them 10 percent of the company without the warrants.

(Source: CBS News)