The US Treasury said last night it was selling 30m shares of General Motors at $34.41 (£22) each, raising roughly $1.03bn as part of its ongoing effort to exit from the bailed-out company and reduce losses to taxpayers.
The public offering, which coincided with GM’s re-entry to the Standard & Poor’s 500 index, will take the amount recouped for US taxpayers so far to $32.53bn. That represents a $16.97bn shortfall from the original $49.5bn bailout price tag. GM shares closed yesterday at $34.44.
Treasury officials have said the goal was not to turn a profit but to save US jobs. GM’s rescue, as the nation struggled to survive a severe recession, helped keep the US auto industry alive. The costs of it going under would have been much higher, officials argue.
With the sale, Treasury will still hold 189.2m shares. It has said that it plans to completely exit the holding by April 2014. It would have to sell the shares at an average price of $89.69 each to spare taxpayers from any loss.
The offering was taking place along with the sale of 20m shares of GM stock held by the UAW Retiree Medical Benefits Trust.
City A.M. Reporter