Chrysler's bankruptcy may take as long as two years, instead of the two months that President Barack Obama suggested as a target, Bloomberg said, citing an administration official.

The 60 days projected by Obama at an April 30 press conference announcing Chrysler's bankruptcy only applies to a sale of the automaker's best assets to a new entity, the official told the news agency.

Creditors would then fight over unwanted factories and other assets to recover money, the news agency cited lawyers as saying.

Chrysler has received bankruptcy court approval to proceed with a rapid sale of most of its assets to a new company held by Italy's Fiat SpA , a United Auto Workers union-aligned trust and the U.S. and Canadian governments.

(Reporting by Ajay Kamalakaran in Bangalore)

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