GM is back

jamesmith

General Motors files for initial public offering, planning to sell stock in a bid to repay U.S. taxpayers for bailout.



http://in.reuters.com/article/idINIndia-50917020100818
By Clare Baldwin and David Bailey
(Reuters) - General Motors Co will list its shares on the New York Stock Exchange and Toronto Stock Exchange after its initial public offering, a source familiar with the matter said on Wednesday.

The filing for GM's IPO with U.S. securities regulators is expected on Wednesday, two people involved in the top U.S. automaker's preparations for going public said.

The IPO, intended to repay a portion of the automaker's U.S. government bailout, has been dubbed "Project Dawn," said the source, who declined to be named because preparations for the IPO remain private.

Before its 2009 bankruptcy, GM shares traded on the New York Stock Exchange, and its return has been widely expected as the automaker begins to distance itself from its government-led restructuring and attracts private investors.

Adding a stock listing in Toronto would underscore the role that the governments of Canada and Ontario played as junior partners to the U.S. Treasury in keeping GM from liquidation in bankruptcy.

The Toronto Stock Exchange declined to comment.

A successful GM IPO would strengthen the Obama administration's case that the $50 billion GM bailout has been a financial success for taxpayers as it also saved jobs in areas like Detroit that were hit hard by the recession.

The GM bailout came in the face of public skepticism and Republican political opposition.

GM Chief Executive Ed Whitacre, who steps down at the start of September, has said the automaker needs to distance itself from government ownership and the label "Government Motors" to build momentum in its turnaround.

Still to be determined is the number of shares to be sold by owners including the U.S. government, the governments of Canada and Ontario, and the United Auto Workers union healthcare trust, the source said.

PART OF IPO TO RAISE CAPITAL

Sources previously told Reuters the IPO could raise as much as $20 billion, making it one of the biggest IPOs ever.

The U.S. Treasury plans to sell about 20 percent of the 304 million GM shares it holds, reducing its stake in the top U.S. automaker to under 50 percent, sources have said.

GM itself is not expected to sell new common stock in the IPO but plans to issue some form of preferred or convertible shares, a less risky form of equity that could attract dividend and growth fund investors.

The proceeds from that portion of the offering would go to GM.

Although bankruptcy eliminated about $40 billion in unsecured debt and other obligations for GM, the automaker still needs funds to restructure its money-losing Opel unit in Europe and address a pension shortfall of about $26 billion.

GM has posted two consecutive quarters of profit after slashing costs and debt in bankruptcy and dropping the Pontiac, Saab, Hummer and Saturn brands.

GM spokesman Randy Arickx declined to comment. Treasury spokesman Mark Paustenbach declined to comment.

The U.S. government currently owns almost 61 percent of GM after converting $43 billion of the $50 billion in funding to the automaker into equity.

GM's expected stock market debut, sometime between late October and the U.S. Thanksgiving holiday at the end of November, means the automaker's first trades would come right around the time of U.S. midterm congressional elections.

Government officials and GM executives have repeatedly denied any link with the elections.

The total value of the GM stock offering would be critical. For U.S. taxpayers to recover the $43 billion invested in GM, the market value of the automaker would have to be near $70 billion.

Republican Senator Charles Grassley has asked a special Treasury Department watchdog for an analysis of the GM IPO and how much money would be returned to taxpayers.

Bankers and credit analysts have offered a case for valuing GM as high as $80 billion, given projections from expected 2011 cash flow and comparisons with rival Ford Motor Co.

Ford, the only U.S. automaker to have avoided bankruptcy, has a market capitalization of just over $40 billion. Japan's Toyota Motor Corp, which tops GM in global sales, has a value of about $121 billion.

Analysts see GM as being in the early stages of a turnaround, helped by sharply lower costs, recovering sales in the United States and growth in overseas markets, led by China.

Despite the company's progress, it still faces hurdles restructuring its money-losing Opel unit, which is struggling in a slack European auto market.

GM's 8.375 percent bonds due in 2033 fell to 35.375 cents on the dollar on Wednesday, from 35.75 cents late Tuesday, according to MarketAxess data.

(Reporting by Clare Baldwin in New York and David Bailey and Kevin Krolicki in Detroit, additional reporting by Walden Siew; editing by John Wallace, Matthew Lewis and Gerald E. McCormick)

hillcrest

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好像是捣大侠的语录

top枪

ah，Broken--->Back

greenback

hillcrest