GM plans to sell its stake in Ally Financial

Article by Christian A., on December 5, 2013

General Motors Co. plans to sell its holdings in Ally Financial Inc., a person privy with the matter transaction told Bloomberg. A move to sell its stake would enable GM to avoid a months-long lockup connected to Ally’s initial public offering, according to the person. The US carmaker may also seek to tap demand for Ally’s shares following the lender’s private placement earlier this year that was oversubscribed, the source said.

That deal effectively diluted GM’s stake at Ally from about 9.9 percent to 8.5 percent, according to data from regulatory filings. The latest plan by GM to sell its Ally stake was described by The Wall Street Journal as a private placement valued at about $900 million.

GM's stake in Ally is held indirectly through an independent trust, according to the carmaker’s quarterly securities filing. It was required to be divested by Dec. 24, 2013 before the Federal Reserve granted a two-year extension in October. Ally has been rebuilding its finance business since selling a controlling stake in GMAC to Cerberus Capital Management in 2006.

GM agreed to pay $4.2 billion for Ally's auto lending operations in Europe and Latin America as it aims to expand its in-house financing at its GM Financial unit. In November, Ally repurchased $5.9 billion worth of its shares from the US Treasury and has repaid over 70 percent of the total bailout given by the US government, pegged at $17.2 billion.

Topics: ally financial, gm

If you liked the article, share on:

Pin It

Comments

Recommended

Top Gear has revealed that for its “Stars in a Reasonably Fast Car” segment, it will now be using a slightly enhanced Toyota GT86, which in the U.S. market is...
by - March 24, 2017
Porsche is laying aside any plans of pushing another hybrid hypercar into their line-up -- at least not at this time. Oliver Blume, Porsche Global Chief confirmed in a recent...
by - March 24, 2017
Since 1993, Lexus has produced 4 generations of the Lexus GS, with the GS F amongst its newest member of the family. Unfortunately, rumors are also heating up that the...
by - March 24, 2017
In a leaked image following a presentation held in China, we learned that Czech automobile manufacturer Skoda will soon unveil 2 more new SUVs in China, resulting in a four-model...
by - March 24, 2017
McLaren is said to be designing the next generation of Sports Series, which could include a V6 hybrid among its powertrain options. It was earlier reported that the British automaker...
by - March 24, 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