GM IPO Registration

A group of people with insider knowledge say that General Motors Co could file a registration for the initial public offering of its stock as early as Friday, one day after it reports quarterly results.
The IPO registration was expected to happen this month, but advisers at the company haven’t been clear about how soon the step could be taken, which would reduce the government’s majority ownership stake.
Expected in mid-August, the IPO filing has been delayed, prompting speculation from industry experts that the timing had slipped. Ed Whitacre, GM’s Chief Executive, confirmed last week that GM didn’t plan to file a registration in the short term. Timing is very important when it comes to filing for the IPO. It hinges on the progress the company makes on securing credit with banks.
GM, which is now 61 percent-owned by the government, is relying on the momentum from strong quarterly profits to kasino help attain a $5 billion bank credit facility while it gets ready for stock offerings at the end of the year.
There has been no comment made by GM at the moment. Both GM and government officials have stressed that they expect a complete stock offering by the end of the year. GM has been expected to file for an IPO worth around $20 billion. It would be the largest U.S. IPO since Visa Inc’s $19.7 billion IPO in March of 2008.

 A successful GM IPO would be good news for the Obama administration, as it offers evidence for its argument that its intervention into the U.S. auto industry in 2009 was a successful move. The government bailed GM out with $50 billion in taxpayer funds, allowing the business to restructure in bankruptcy. To date, GM has paid the government $7 billion back.

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Posted by Brett Nordin on Nov 17 2010. Filed under Automotive. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.