The much-ballyhooed GM IPO is rapidly approaching, with the company set to start pitching investors after the midterm elections this coming January. The pitching process is expected to start on Nov. 3, and last two weeks, with the IPO expected to price on Nov. 17 and debut on the trading floor on the 18th. Sources caution that nothing has been finalized just yet, and that things could change, depending on the performance of the U.S. markets.
No final value has been determined, but a source said early plans projected the sales of $12 billion to $16 billion in common stock and $3 billion to $4 billion in preferred stock, which would convert to common stock under a mandatory provision.
Given the hot-button political nature of the initial bailout, company and government officials have come under fire for purposely planning the IPO so close to election time, though this has been vehemently denied. The Obama administration has stood behind its decision to bail the auto companies out, and has pledged to divest itself of its stake in GM as soon as is practical. A final decision as to how much of the government’s stake will be sold in the IPO is yet to be made, and won’t be until the terms of the offering are established.
– By: Stephen Calogera
Source: Automotive News (Subscription Required)