Chinese government wants to buy private equity assets of GM’s pension plan

Article by Christian A., on July 20, 2012

The Chinese government hopes to buy some of the private equity assets of General Motors' underfunded pension plan, hoping to pay from $1.5 billion to $2 billion, according to the Financial Times report. China, which has nearly $1.2 trillion in U.S. treasuries, has been hoping to capitalize on the liquidity concerns of assets managers like pension funds while the financial market remains volatile by acquiring their assets.

The paper said that GM's pension plan has stakes in several of the most prestigious private equity funds in the U.S. and Europe, such as the Carlyle Group LP, the Blackstone Group LP and CVC Capital Partners Ltd.

The sale, which has yet to be completed, will involve the transfer by GM adviser Performance Equity Management LLC of stakes to the State Administration of Foreign Exchange, which controls over $3 trillion in China’s foreign exchange reserves. The newspaper said that State Administration gets advice about the deal from Lexington Partners LLC.

An investment adviser told The Financial Times that the deal was discreet, even by private equity standards, since there’s obviously some concern about the sales of U.S. assets to China, especially during the election year.

The top controversial issues in the current White House campaign are those involving the private equity industry and U.S relations with China, especially when it comes to trade and the outsourcing of jobs. The political debate may get worse with the sale of assets by GM's pension plan to China. President Barack Obama considers GM's $50 billion bailout in 2009 as one of his main achievements. [source: Telegraph]

Topics: gm, plan

If you liked the article, share on:

Comments

Recommended

Hyundai is introducing a new 2018 Accent that is not only wider and longer, but is now also sporting a new look that is more serious than the previous model....
by - February 20, 2017
Fans and enthusiasts of the BMW M2 in the United States could now rejoice. This comes as their favorite BMW M2 is getting a limited edition version as prepped by...
by - February 20, 2017
Carmakers usually leave us thirsty for information on whether they would introduce a new, refreshed or face-lifted vehicle and on when they intend to launch it. There are reasons for...
by - February 20, 2017
Cadillac’s CT6 full-size prestige-luxury sedan is still somewhat new. It has been offered to the global auto market for two model years – 2016 and 2017. But for those who...
by - February 19, 2017
In many industries, it is the rivalries that make things exciting. In basketball for example, there is the well-known rivalry between the Los Angeles Lakers against the Boston Celtics. For...
by - February 19, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries