GM to sell Suzuki stake to raise $230 million
GM has decided to sell its stake in Suzuki Motor Corp for 22.37 billion yen ($230 million USD). Suzuki said today that it will buy back 3.02 percent stake from the auto giant helping it stay afloat while Congress makes a decision on aid for the auto industry.
Suzuki said that it was necessary for it to buy back GM’s stake for the company to raise capital and said that it will continue a business partnership with GM. Suzuki’s CEO Osamu Suzuki said that the two companies would keep joint projects which includes the development of hybrid vehicles and a joint venture for an SUV in Canada.
GM sold 17 percent of its stake in Suzuki in 2006 leaving the General with 3 percent. The automaker has warned that it could run out of cash in 2009 if the government doesn’t help and if the U.S. economic conditions don’t get any better.
Source: The Detroit News