GM roars back to public market, stock above IPO price in early trading

Publie le 18 novembre 2010
(http://ca.news.yahoo.com/s/capress/101118/business/us_gm_ipo

By The Canadian Press, The Associated Press
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General Motors returned to life as a public company Thursday with its shares quickly rising above the IPO price in early trading on the New York and Toronto stock exchanges.

In New York, the shares (NYSE:GM) traded at US$35.39 and in Toronto (TSX:GMM.U) were at US$35.45 within the first hour of trading Thursday.

GM set a price of US$33 per common share on Wednesday, at the high end of a range that had already been increased once due to early investor demand for the shares.

The U.S. government, the Canadian federal and Ontario governments and other owners will raise a total of US$18.2 billion by selling at the IPO price. GM will raise another US$5 billion by selling 100 million preferred shares at US$50 each.

The U.S. Treasury is unloading more than 400 million shares of GM, reducing its stake in the company from 61 per cent to about 33 per cent. The stock sold through the IPO would be worth about US$13.6 billion.

Canada's federal and Ontario governments have owned a combined 11.67 per cent of General Motors since last year's bailout of the automaker. They're reducing that stake to below 10 per cent by selling about 35 million shares through the IPO.

Canadian Industry Minister Tony Clement and Finance Minister Jim Flaherty have said they're in no hurry to sell more GM shares at this time, since they've been advised that the stock may be worth more in future.

Kevin Williams, who was appointed to head GM's Canadian subsidiary in March, said the company recognizes the opportunity that people in both countries have given General Motors and the need to prove itself.

"General Motors is a much leaner, much faster organization," Williams in an interview with BNN, a specialty business cable channel.

"We've looked at every part of the business and restructured it for success. We've driven our cost structure to the lowest point in a very long time and we've put the company in position for sustainable growth going forward."

"We are absolutely thrilled that the U.S. and Canadian government has given us an opportunity, along with the people of Canada and the U.S., and we believe it's our mission to demonstrate the value for those shareholders."

The head of GM Canada's largest union, CAW national president Ken Lewenza, said Thursday he supports the idea of having a continuing government role in the auto sector.

"We would encourage the Canadian government to take their time," Lewenza told BNN.

"In fact, we would encourage the Canadian government to do what other countries are doing, like in China and Korea, and have some stake in the automobile industry."