US Government To Sell Off Remaining Stake In GM

This photo was taken outside of the New York Stock Exchange on November 18th, 2010 - the first day that General Motors' stock was traded publicly since the company's bankruptcy, reorganization, and subsequent bailout by the US Government. Now that the dust is finally settling, the U.S. Government is looking at a $12 billion loss.

GM is one more step closer to leaving its “Government Motors” days behind. Last month we told you about how GM had purchased 200 million of its own shares back from the US Government, and according to a report last week in the Detroit News, the U.S. Treasury has announced that it will soon start to sell off all the remaining GM shares on the open market.

The Treasury plans to sell off the 19 percent stake that it currently holds in GM “in an orderly fashion” over the next year or so. The main goal of the extended sale is to prevent hedge funds and opportunistic investors from taking advantage of the situation, rather than maximize the return on the government’s investment in GM.

Sadly, it doesn’t look like Uncle Sam and taxpayers will even come close to breaking even on the GM bailout. According to the Detroit News’ report, the Treasury would have to sell its remaining shares for at least $72 a piece just make all its money back. If the remaining shares are sold to the open market at GM’s current stock price of just over $29 a share, the government stands to lose just over $12 billion.  

For more info, check out the full report on the Detroit News website.

About the author

Clifton Klaverweiden

Clifton has been a car fanatic since his late teens, when he started the restoration of his '67 Camaro. He considers himself a student of automotive science and technology, and particularly loves all things LSX. And, although he has an appreciation for everything, from imports to exotics, his true passion will always be for GM musclecars.
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