Tags: GM | IPO | US | Minority | Shareholder

GM’s $13 Billion IPO to Make US a Minority Shareholder

Wednesday, 03 Nov 2010 04:07 PM

General Motors on Wednesday finalized terms for a nearly $13 billion stock offering to repay a controversial taxpayer-funded bailout and reduce the U.S. Treasury to a minority shareholder.

The automaker plans to sell 365 million common shares at $26 to $29 each, raising about $10 billion at the midpoint, according to updated initial public offering papers filed with the U.S. Securities and Exchange Commission.

In addition, GM said it plans to sell about $3 billion of preferred shares that would convert to common shares under mandatory provisions, a less-risky form of equity that may attract dividend and growth fund investors.

Also Wednesday, the U.S. automaker said it expects to report third-quarter earnings up to $2.1 billion and would report a profit for the full year.

GM also said shareholders approved a 3-for-1 stock split.

"We will deliver a solid and profitable first year post-bankruptcy, and we are continuing to improve our balance sheet and most importantly, the quality of our vehicles," Chief Financial Officer Chris Liddell said in a statement.

GM expects to report earnings before interest and tax of $2.2 billion to $2.4 billion for the third quarter.

Fourth-quarter earnings before interest and tax will be significantly lower than the first three quarters of the year because of different production schedules, costs for introducing its Chevy Cruze small car and electric Chevy Volt and increased engineering spending for future products, GM said.

GM plans to release third-quarter results one week from today.

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General Motors on Wednesday finalized terms for a nearly $13 billion stock offering to repay a controversial taxpayer-funded bailout and reduce the U.S. Treasury to a minority shareholder. The automaker plans to sell 365 million common shares at $26 to $29 each, raising...
GM,IPO,US,Minority,Shareholder
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2010-07-03
Wednesday, 03 Nov 2010 04:07 PM
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