Tags: Car | Rattner | GM | Stake

Former Car Czar Rattner Sees ‘a lot of Value’ in Govt’s GM Stake

Wednesday, 02 May 2012 10:17 AM

Now isn't the time for the government to sell its stake in General Motors, says President Barack Obama's former "car czar" and Willett Advisors chairman Steven Rattner.

The government owns about a third of General Motors stock but should hang on to the stake until 2013 or 2014, when the stake would fetch a better sales price.

"I personally believe there's a lot of value in GM stock that's been badly treated by Wall Street," Rattner tells CNNMoney.

GM shares have fallen 30 percent since the company went public in November 2010.

"The Treasury always assumed it would hold onto it for awhile maybe as long as five, six, or seven years," says Rattner.

In late 2008, the U.S. Treasury spent about $50 billion for a 61 percent stake in GM and since that bailout, the government has cut that stake in half.

For taxpayers to break even, GM's stock needs to more than double to $51, up from over $23 today.

Company CEO Dan Akerson told Newsmax.TV recently he felt the company's share price was undervalued.

"Well you know every CEO thinks their stock is undervalued. When I hear that all I know is how it's valued in the market and that's where it trades. The fundamentals of General Motors coming out of bankruptcy isn't what the stock price is," Akerson tells Newsmax.TV in an exclusive interview.

"Quite candidly, it's how our products are received, and how well they sell in the marketplace and if we do that and if we provide a great customer experience, those are fundamentals that will serve us long beyond the post-bankruptcy recovery period, which I think General Motors is still in," Akerson says.

"It will take us a couple of years to kind of unwind the difficulties we went through, and I think fundamentals will prove out."

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