Jump to content

GM stock closes at $34.19, just above $33 IPO price


Recommended Posts

GM stock closes at $34.19, just above $33 IPO price



General Motors stock closed at $34.19 today, just above the $33 price of the initial public offering.

Earlier in the day, there was speculation that GM’s shares could reach or even top $40 per share, but the highpoint was $35.99 at about 9:40 a.m.

The U.S. Treasury was hoping the stock price wouldn't rise too much on the first day so it can avoid complaints that it should have asked more for its shares.

• More: Wall-to-wall coverage of GM's IPO

GM’s owners sold at least 478 million common shares and were expected to sell 15% more, just 16 months after the automaker emerged from its 40-day government-funded bankruptcy. In its restructuring, GM lowered its break-even point, closed plants, shed four U.S. brands and wound down dealers — all while surviving on $49.5 billion from the U.S. government and $8.6 billion from Canadian governments.

“We’ll never forget that support,” CEO Dan Akerson told reporters on a conference call. “We know how we arrived here. We know what went wrong, and I believe we’ve learned a lot from that.”

Including the extra 15% of shares, the U.S. Treasury reduced its stake from 61% to 33%, Chief Financial Officer Chris Liddell said.

The Treasury, the UAW health-care trust and Canadian governments received $32.75 per share of common stock they sold, after about 25 cents in fees to banks underwriting the deal. GM disclosed the fee this morning in a final notice making its stock offering effective.

After the underwriters’ fees, the government likely recouped $13.5 billion on the sale. After a waiting period of at least six months, the government will need to sell its remaining shares in GM at an average of nearly $53 each to recoup its entire investment in GM. Along with the stock sale, it can count on $10 billion in repaid interest and loans and repurchased Series A preferred stock.

GM also sold at least 87 million Series B preferred shares worth at least $4.4 billion. Most of the proceeds will go toward GM’s underfunded U.S. pension plans.

More than 90% of GM’s stock offering went to North American firms, Liddell said.

Out of the likely $18.1 billion in common stock, close to $4 billion went to firms that allocate it to individuals – deemed an important measure, since taxpayers put up the money for GM’s restructuring.

Liddell said that was the biggest allocation to so-called “retail investors” of any IPO in history and a higher percentage than Visa’s. Visa’s 2008 common-stock IPO, the biggest in U.S. history, raised $19.7 billion, slightly more than GM’s expected amount.

Read more: GM stock closes at $34.19, just above $33 IPO price | freep.com | Detroit Free Press http://www.freep.com/article/20101118/BUSINESS0101/101118033/GM-stock-closes-at-34.19-just-above-33-IPO-price#ixzz15gVpwrJm

Link to comment
Share on other sites

GM stock closes at $34.19 after first full day of trading

by John Neff (RSS feed) on Nov 18th 2010 at 4:16PM

The first day of a new era for General Motors has ended. The automaker released its IPO this morning on the New York Stock Exchange, and after reaching a high of $35.85 around 10:45AM EST, the stock price slowly retreated back to earth and settled on $34.19 for a closing price. Sure, you might see a downward trending line on the above graph, but GM can celebrate the fact that its stock price still ended the day more than a dollar above the $33 at which the IPO was priced to kick things off, a respectable rise of 3.6%.

Now that the day ended, President Obama has planned a quick preference to talk about General Motors that's starting as we speak. You can watch it live on the Whitehouse.gov website.



Link to comment
Share on other sites


By Mark Kleis

After months of never ending reports and speculation regarding the future General Motors initial public offering, finally, the offering has been held and the stock is officially trading in the New York Stock Exchange (NYSE) once again.

In order to mark the historic moment, Dan Akerson, GM CEO, rang the bell to open trading for the day at the NYSE, flanked by key members of the GM management team. Outside, GM parked its latest vehicles on the street to mark the occasion.

Late Wednesday night the price was finally set at $33 per share, but shares opened at a strong $35 a piece. So far, the stock has climbed as high as $35.99, but has since dropped back down to roughly $35.35. The sales generated $20.1 billion for the automaker, marking the most money ever raised on a first day stock offering.

The federal government had a successful day as the Treasury was able to reduce its ownership significantly, selling 75 percent of its common shares and bringing back nearly $12 billion of taxpayer funds. It is estimated that the U.S. government still needs approximately $27 billion in order to break even, which would require GM stock to rise 25 percent to nearly $41 per share



Link to comment
Share on other sites

Join the conversation

You are posting as a guest. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

About us

CheersandGears.com - Founded 2001

We ♥ Cars

Get in touch

Follow us

Recent tweets


  • Create New...