The Treasury department is hoping to divest its remaining shares of GM stock over the next two years, Timothy Massad, the senior Treasury official managing the bailout fund told a congressional hearing Wednesday. After GM’s IPO, the government divested most of its stake, trimming it down to 26.5%, from 61%, raising $23.1 billion.
Massad called the November stock sale a major milestone. “Now that we have completed the initial public offering of GM, we do have a pathway to sell the rest of our shares,” he told the panel. “And I would expect that we would sell all those … hopefully within the next two years, market conditions permitting.”
Massad said that the government still has $166 billion invested in various companies that received support from the TARP fund, and that he was hopeful that most of that money would be recovered in two years. The terms of the November IPO dictate that the government cannot sell any additional shares in GM until mid-May.
The remaining shares in GM will need to be sold at a price of $53 each in order for the government to break even on its $49.5 billion investment in the collapsed automaker.
– By: Stephen Calogera