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DATE News (chronologically)
09/20/10
automotive
Government could seek foreign investors for GM UPDATE China's largest automaker SAIC Motor Corp. has reached out to General Motors Co. about acquiring a stake in the Detroit automaker when the company launches a public stock offering later this year, a person briefed on the matter said Sunday.

SAIC spokeswoman Zhu Xingjun said Sunday, "SAIC is closely watching the progress of GM's IPO. SAIC wishes the success of the GM IPO." She declined further comment.

Last month, Shanghai Auto Chairman Hu Maoyuan told reporters in China that the company was considering an investment in GM. Maoyuan said SAIC "will watch GM's IPO closely, and think carefully if we should purchase the shares or not," according to the Financial Times.

Reuters first reported the contact between state-supported SAIC and GM, and said SAIC had expressed an interest in acquiring a "single digit" share in GM, or less than 10 percent. A 5 percent stake could cost $2.5 billion to $3 billion, based on estimates of GM's future market capitalization.

SAIC is GM's principal partner in China, where the companies have two joint ventures. The companies announced in December they were teaming up to sell vehicles in India. They are planning to bring a low-cost sedan to India next year that's being designed in China -- the first of a series of new models.



09/20/10 Investment bankers handling the upcoming General Motors Co. stock sale are expected to court foreign investors as well as those in North America, according to a U.S. Treasury Department statement.
GM and the Treasury Department would not comment Sunday on reports that the automaker is in talks with its current partner in China, SAIC, about buying a stake in the Detroit company. SAIC is owned by the Chinese government.

The Treasury Department, in a statement issued late Friday, said investors in GM would be sought across "multiple geographies," with a focus on North America. zzzz

The U.S. Treasury loaned GM about $50 billion to help it through bankruptcy protection last year. GM has repaid $6.7 billion. The rest of the bailout money was converted to a 61 percent government stake in the company.

The government hopes to get the remaining $43 billion back with stock sales that could start in mid-November.

Foreign investment in U.S. automakers and other companies is common. Before the stock sale, GM will put on a two-week "road show" of presentations for investors, and several stops are expected to be in cities outside the U.S.

The Treasury statement also said banks underwriting the GM stock sale will be expected to balance getting the maximum price per share and return for taxpayers with having a stable base of shareholders and keeping up interest in several sales that will occur after the initial public offering.

Individual investors will get "ample opportunity" to buy GM shares, but institutional investors such as mutual funds, hedge funds and pension funds will be sought out, the statement said.

"We expect that a large and diverse group of institutional investors will be offered an opportunity to participate, with no single investor or group of investors receiving a disproportionate share or unusual treatment," the statement said.  More at Yahoo! News

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