Update: General Motors Company today announced an increase in the proposed size of the offering of its common stock to be sold by certain of its stockholders from 365 million shares to 478 million shares. Both of these share totals exclude the amount that the underwriters have the option to purchase to cover over-allotments, if any. The company previously announced an increase in the estimated price range for the offering of common stock to $32 to $33 per share. The final terms of the offering will be determined at the time of pricing.
General Motors may start selling shares for as much as $33 in an initial public offering, according to four people familiar with the plans. The figure is 14 percent more than originally planned. Earlier this month, GM said that it plans to raise as much as $13 billion by selling 365 million shares of common stock with a price range of $26.00 to $29.00 per share.
Strong vehicle sales and earnings at GM have pushed up the demand for the stock, prompting the company and its banks to encourage adding shares or raising the price range, sources said.
GM will now sell $4 billion worth of preferred stock and sources say that demand is so strong that GM and the U.S. Treasury, which own 61 percent of the company also discussed increasing the number of shares offered.
At $33 a share, the Detroit automaker would raise $12 billion by selling common stock. Including an overallotment option for the underwriters to sell more shares, the offering would raise $13.9 billion.
GM is back ladies and gentleman.
– By: Omar Rana