GM execs dump shares as bankruptcy looms
General Motors Corp. reported that six executives sold shares in the company, as the largest U.S. automaker said it’s more probable than previously thought that it will need to file for bankruptcy. Vice Chairman Bob Lutz and North America President Troy Clarke sold all their holdings in the Detroit-based company, according to regulatory filings today.
The sales were in a window when such transactions are allowed, following the company’s quarterly earnings report on May 7, said Julie Gibson, a spokeswoman. The period may be the last for the executives before the government-imposed June 1 deadline for GM to restructure or file for bankruptcy, she said.
Chief Executive Officer Fritz Henderson made the comment about the probability of bankruptcy on a conference call today. He declined to specify its likelihood. Henderson also had said bankruptcy was “more probable” on March 30, after former CEO Rick Wagoner was ousted by the Obama administration, and made the same point in a conference call two weeks ago.
“It should be clear now where they’re headed,” said Mirko Mikelic, who helps manage $19 billion, not including GM shares, at Fifth Third Asset Management in Grand Rapids, Michigan. “There are too many competing interests. They’re definitely going there. Everyone is positioning for bankruptcy now.”
GM fell 17 cents, or 11 percent, to $1.44 at 4:15 p.m. in New York Stock Exchange composite trading. They lost 93 percent of their value in the past 12 months.
Lutz sold 81,360 GM shares, at $1.61 each, according to a filing. Clarke sold 21,380 at $1.45 a share. Others selling stock were Vice Chairman Thomas Stephens and Group Vice Presidents Gary Cowger, Carl-Peter Forster and Ralph Szygenda, according to the filings.