US plans to exit General Motors stake by the end of the year

 
City A.M. Reporter
THE US Treasury department said yesterday it expects to sell its remaining shares of General Motors by the end of the year, a plan that may leave taxpayers with a shortfall of about $10bn (£6.2bn) on the automaker’s 2009 bailout.

The Treasury said it had completed the sale of 70.2m shares of GM stock and to date had recouped $38.4bn from the $49.5bn taxpayer-funded rescue of the Detroit company. At current prices, it would recoup another $1.2bn from its remaining stake, bringing its total recovery to $39.6bn.

“Our goal was never to make a profit,” said a Treasury official who requested anonymity. “It was to save the US auto industry.”

The Treasury said the sale would take place by year-end, subject to market conditions and if average daily trading volumes continue at recent levels.

“While the US Treasury’s equity stake draws to a close, our work to transform GM continues,” GM said.

Analysts have said the Treasury’s exit from GM would lift the so-called Government Motors stigma from the automaker, which would also be able to begin paying dividends for the first time since the restructured company returned to the market with an initial public offering three years ago.