GM may sell shares for as much as $33 in an initial public offering

Article by Christian A., on November 16, 2010

Because of the strong demand, General Motors Co. may sell shares for up to 14% higher than the original plan, equivalent to $33 in an initial public offering, according to four insiders.

The sources also said that the number of shares may even be increased. Earlier this month, GM said that it could raise as much as $10.6 billion by selling 365 million shares for up to $29 each.

Demand for the stock had increased due to rising vehicle sales and earnings at GM as well as a rapidly growing equity market.

As a result, the company and its banks decided to encourage either raising the price range or adding shares. One source said that GM will sell $4 billion worth of preferred stock, up from $3 billion. If the price is set at $33, GM would be able to raise $12 billion selling common stock.

If an overallotment option for the underwriters to sell more shares is included, the offering would raise $13.9 billion.

One source also disclosed that JPMorgan Chase & Co. and Morgan Stanley, which are two of GM's lead investment banks, are urging the US Treasury (which owns 61% of GM) to offer more shares than the 419.8 million that would be sold if the current overallotment option is exercised. [via autonews - sub. required]

Topics: gm, ipo, shares, united states

If you liked the article, share on:

Comments

Recommended

As seasons change, temperatures rise and fall. The changes affect our preferences when it comes to driving cars. Therefore, Aston Martin introduces the new DB11 Volante or convertible, and it...
by - October 16, 2017
Aston Martin may be known for building many of the stylish Bond cars we see on the big screen but nobody really knew how it can get super aggressive when...
by - October 16, 2017
Today, manual transmissions have become rare in mainstream cars and are more commonly found in performance cars within the $20,000 to $40,000 range. However, the selection of affordable, three-pedal performance...
by - October 16, 2017
We expected to see the BMW i8 Roadster at last month’s 2017 Frankfurt Motor Show, but it never made an appearance. So the question on fans’ lips now is when...
by - October 16, 2017
Jaguar has just released the first official image of its newest offering, the new Jaguar XEL. Essentially the long-wheelbase version of the Jaguar XE compact sedan, the new Jaguar XEL...
by - October 14, 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