The government is in the final phase of getting the Government out of Government Motors.
Government Motors is basically no more, and the final price tag for taxpayers to bailout the automaker is about $9.7 billion.
The U.S. Department of Treasury now owns just 7.3% of the General Motors’ common stock after its most recent stock sell off.
Taxpayers originally held 60.8% of GM in exchange for the bailout loans. Treasury has been selling down that stake, but ramped up its efforts this year.
“Through a series of stock sales, Treasury has divested its preferred stock and most of its common stock, reducing its stake to 7.3%,” the department said in a report today. “Because the common stock sales have all taken place below Treasury’s break-even price, Treasury has so far booked a loss of $9.7 billion on the sales.”
There is still a small chance the government could break even on the deal. It could sell the remaining 101 million shares it owns for $148 each.
GM stock was trading at $35.72 today, which makes the remaining taxpayer stake worth about $3.6 billion.
The Treasury is conducting a new round of selling and has said it will divest all the shares by the end of the first quarter of next year. Late last year, the government announced plans to sell off the remaining stock by April of 2014.
(GM struggles to change perceptions. For more, Click Here.)
GM received $49.5 billion to complete its restructuring, a bailout initiated by former President George W. Bush in 2008 and completed by Barack Obama in 2009 as the maker exited a managed bankruptcy.
The White House also approved a bailout for GM’s crosstown rival, Chrysler, but only after Italian automaker Fiat stepped in and effectively assumed control.
(Click Here to read about Treasury’s plans to divest GM’s stock.)
The administration has said repeatedly that it has no interest in being in the car business. And it began selling down its stake in November 2010 when GM staged its initial public offering. Priced at $33 a share, it reduced the Treasury’s stake to 33%.
I’d like to get $9.7 Billion for FREE to help my business along! What a crock of shit that the U.S. government is so incompetent as to pull a scam on tax payers like this!
Jorge M. above is one of those people whose beliefs have been twisted by, and whose anger has been stoked by, the carefully crafted right-wing distortion machine. He has his analysis all wrong. He thinks the government is incompetent and that this is a scam on the taxpayers.
Mr. M., the choice in 2008 was to allow GM to disappear from existence. Is that what you think was a good idea? Were the disappearance of tens of thousands of jobs and an icon of American business simply not important? If all that had collapsed, like you think would have been fine, what would you have said then? You probably still would have said that the government was incompetent for letting it happen.
All of the choices were bad in some way at that time. But then, if you want to talk about scam, why have you forgotten the fraud on Wall Street which caused all of this? How many top leaders of those companies are in jail? Maybe, none? You want to blame government because that is what the right wing tells you to do. Can’t you see fraud where it really happens?