Canada sells part stake in GM for $1.1 bn
11 September 2013The Canadian government yesterday sold 30 million shares of General Motors Corp for around $1.1 billion.
Canada GEN Investment Corp, the government's holding vehicle for its stake in GM, sold 30 million in GM common shares at the closing market price in a block trade to Bank of America Merrill Lynch and RBC Capital Markets.
GM shares closed yesterday at $37, which would value the Canadian government's stake at around $1.11 billion.
Post sale, Canada GEN Investment Corp, will still hold more than 110 million GM common shares and more than 16.1 million preferred shares.
"As we said from the start, our investment in GM was always meant to be temporary as we worked to maximize the return to Canadian taxpayers," said Jim Flaherty, Canada's finance minister in a statement.
"The Government of Canada is committed to exiting from ownership of GM as quickly as feasible, while maximizing the return for Canadian taxpayers, as we demonstrated today."
Canada and Ontario governments contributed $9.66 billion to bailout the Detroit-based carmaker during the global recession in 2009. As part of the bailout deal, GM agreed to keep its production lines running in Canada.
Prior to yesterday's sale, Canada and Ontario governments held 10 per cent in GM valued at $5.1 billion. They sold 35 million of their 175 million shares during GM's initial public offering in 2010.