GM plots IPO to reduce government stake
GENERAL Motors plans to file its registration for an initial public offering during the week of 16 August, just after the expected date for its second quarter results, according to US sources.
A GM filing with the US Securities and Exchange Commission would be the first step towards an IPO to reduce the US government’s ownership in the carmaker after a $50bn £32.7bn bailout in 2009.
By filing with the SEC in August, GM is aiming to complete its IPO before the November US elections, according to the sources, who asked not to be named because the closed-door preparations remain confidential.
GM also remains in talks with Bank of America Corp JPMorgan Chase & Co and Wells Fargo & Co for dealer and consumer financing for more credit-worthy borrowers, one of the sources said.
One concern for potential investors has been whether GM dealers and potential car buyers have the same kind of access to financing as competitors with in-house financing operations like Ford Motor Co
General Motors on Thursday said it would buy auto finance company AmeriCredit Corp (ACF.N) for $3.5 billion in cash to form what it called the “core” of a captive finance operation. The move marks a reversal of the position GM took when it sold control of its former in-house financing arm GMAC in 2006.
Any additional financing partnership agreement GM reaches would be complementary to the AmeriCredit transaction, one of the sources said. Many GM dealers have complained that lack of consumer financing has cost them sales.
An IPO for the U.S. automaker, which was restructured in bankruptcy last year, would be the biggest U.S. stock offering since Visa Inc’s (V.N) $19.7 billion March 2008 IPO and one of the biggest IPOs of all time.
GM’s second-quarter earnings report is expected to show the automaker generated cash for a second consecutive earnings period, according to one of the sources.