GM SEC Filing Reveals Partial Details On IPO

August 18, 2010

 GM today filed registration with the Securities and Exchange Commission for its proposed Initial Public Offering (IPO). The announcement reveals the stock to be sold will consist of both common stock held by "certain" of its stockholders and issuance of Series B mandatory convertible junior preferred stock.

So what does all of that financial gobbledygook mean? It means the "new" General Motors is about to become a publicly traded company on the open market, and that the federal government will recoup some more of its investment in the company.

The question now becomes how GM's stock will do once sales of stock open up, especially with a new CEO at the helm. The appointment of Dan Akerson in place of Ed Whitacre is thought to have delayed the IPO filing. Whether that move will help or hurt the IPO is yet to be seen, though the change at the top does not appear to be listed as one of the many "risk factors" for potential investors in the preliminary prospectus filed today.

The total amount of stock offered in the sale hasn't been released, as GM says it will be determined by "market conditions and other factors at the time of the offering." Morgan Stanley and J.P. Morgan, BofA Merril Lynch, Citi, Goldman Sachs, Barclays Capital, Credit Suisse, Deutsche Bank Securities, RBC Capital Markets, and UBS Investment Bank will handle the IPO.

[GM]

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