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Report: GM to make another $1B loan repayment


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Filed under: Government/Legal, GM


Last December General Motors began repaying its debt to the U.S. government by making a $1 billion payment to its U.S. debtors and another $192 million to Canada. Company CEO Ed Whitacre promised that the payments would keep coming every quarter until the loan was paid off in June, 2010, and with the first quarter of 2010 coming to a close, The General is about due for another payment. Keeping with Big Ed's word, the company issued a statement on Thursday that the next installment of another billion dollars will be paid on March 31.

The brief statement is attributed to Whitacre and promises another $1 billion in cold, hard cash to the U.S. government and an additional $192 million to Canada. In the statement Whitacre sounds confident that the loans will soon be paid in full, adding "GM has every confidence that the remainder of the loans will be paid in full by June 2010; five years ahead of schedule."

On April 1 The General will have shaved $2 billion off its debts with another $4.7 billion to go. We're no math experts, but we're guessing $1 billion per quarter is going to have to be substantially increased over the next three months to repay its debt in full by June 30. But with about $40 billion in the bank, GM will likely have the cash on hand to pay off Uncle Sam by the time Summer is in full swing.

Once GM does pay off its $6.7 billion loan, the feds will still own 61% of the Detroit, MI-based automaker, but with some analysts expecting GM to take its stocks public in the next few months, the automaker could soon be a fully public company again. We're sure GM executives will be very happy when that happens. Hit the jump to read GM's brief press release.

[source: Detroit Free Press | Image: Bill Pugliano/Getty]

Continue reading Report: GM to make another $1B loan repayment

Report: GM to make another $1B loan repayment originally appeared on Autoblog on Fri, 26 Mar 2010 08:30:00 EST. Please see our terms for use of feeds.

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