5% Of GM Stock Set Aside For Employees In IPO
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General Motors Co. wants to set aside five percent of the company’s common shares for its employees, car dealers and retirees to buy in an initial public stock sale expected next month.
The IPO will allow GM’s shareholders, including the U.S. and Canadian governments, to sell at least part of their ownership stakes in the automaker. But GM said in a regulatory filing on Thursday that it also wants to reserve a portion of common shares for its U.S. and Canadian workers.
An IPO date and share price have not been set officially, but Chairman Ed Whitacre has predicted that GM’s common stock will be priced between $20 and $25 a share when it is sold to the public sometime in November.
That price range is affordable for small investors, but to reach that level, GM will have to split its current pool of shares.
GM employees and dealers have until Oct. 22 to sign up to buy the shares at the IPO’s initial price. They must invest at least $1,000 to participate.
Like other investors, GM employees, dealers and retirees can sell their shares in the stock market after the IPO. GM has about 600,000 employees and retirees in the U.S and Canada.
The U.S. government plans to sell a portion of the 304 million shares it got in exchange for rescuing the automaker last year. It could take years and several follow-up sales for the government, which is the automaker’s largest stockholder, to unload all its shares and recoup about $43 billion that GM still owes it.
GM’s other shareholders – the Canadian and Ontario governments, a union health care trust fund and GM’s old bondholders – also can sell shares in the initial stock sale. Just how many shares each owner intends to sell has not been made public.
GM will sell no common stock itself, but plans to offer preferred shares, which pay a dividend.
(Copyright 2010 by The Associated Press. All Rights Reserved.)