Filed underDaily J PM
The management change at General Motors is causing the automaker to delay filing paperwork to sell shares to the public.
The Detroit automaker had planned to file the papers on Friday but delayed the move to build distance between the filing and two major announcements it made on Thursday, according to one person familiar with the matter.
GM said Thursday that CEO Edward Whitacre would step down as CEO Sept. 1 and be replaced by board member Daniel Akerson. It also reported a $1.3 billion second-quarter profit, its second-straight positive quarter.
The board has not yet decided the date of the stock sale.
However, experts say an initial public offering, or IPO, generally takes place three months after early paperwork is filed.
GM got $50 billion in aid from taxpayers last year in exchange for 61 percent of the company. It repaid $6.7 billion that was considered a loan, and a stock sale would repay at least some of the remaining $43.3 billion.
One person with knowledge of the situation said GM’s board is weighing two desires: To shed government ownership quickly or wait longer and perhaps sell shares for a higher price if the automaker continues to do well.
Whitacre has said that government ownership is hurting the company’s public image and sales.
The Obama administration may be pressuring GM to sell shares soon to influence the November congressional elections and make the government’s controversial investment look smart, some analysts say. But Whitacre and the government have said GM is in charge of the IPO timing.
© MMX WWJ Radio, All Rights Reserved. The Associated Press contributed to his report.