GM buying back 200 million Shares of Common Stock from U.S. Treasury
(Best Syndication News) - General Motors Company (NYSE:GM) announced today that they will be buying back 200 million shares of GM common stock from the U.S. Department of the Treasury. The transaction will be for $27.50 per share – totaling $5.5 billion. The company will buy back 200 million shares out of the 500.1 million shares owned by the government. The buyback is expected to occur by the end of 2012.
GM’s buyback announcement parallels the Treasury’s plan to exit entirely from holding GM stock within the next 12 to 15 months. The exit plan is subject to market conditions.
The buyback at $27.50 per share was 7.9 percent more than the closing price on December 18, 2012. After this latest buyback, the government will own around 300 million shares of GM common stock, which accounts for around 19 percent of the outstanding shares on a fully diluted basis.
The government started buying GM stock in 2008 when President George W. Bush was in office. The financial assistance was expanded in 2009 after President Barack Obama took office.
The next round of the U.S. Treasury selling will start as soon as January 2013.
By: Dave Reddy