General Motors Corp has offered to convert half of a $20 billion funding obligation to a union-aligned retiree healthcare trust into preferred stock, business television station CNBC reported on Friday.

GM has offered the United Auto Workers union $10 billion in cash, amortized over 20 years, and $10 billion of preferred stock with a 9 percent coupon, to fund the healthcare trust, CNBC reported.

Under the terms of GM's $13.4 billion government bailout, the automaker is required to reach an agreement with the UAW to cut its cash contribution to the trust, known as Voluntary Employee Beneficiary Association.

A spokeswoman for the UAW declined to comment on the CNBC report. A GM representative was not immediately available for comment.

CNBC also said GM has made new offers to the holders of about $28 billion of debt. Under the terms of the government bailout, GM is required to reduce that debt by two-thirds.

GM, which has requested more than $16 billion of additional emergency government loans, faces a deadline at the end of the month to reach agreements with creditors and demonstrate that it has a plan to become viable over the long term.

(Reporting by Soyoung Kim and Poornima Gupta)

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