Posted on 11/18/2010 7:58:22 AM PST by SeekAndFind
General Motors stock began trading on Wall Street again Thursday, signaling the rebirth of an American corporate icon that collapsed into bankruptcy and was rescued with a $50 billion infusion from taxpayers.
The stock rose sharply in its first minutes of buying and selling, going for nearly $36 per share -- nearly $3 more than the price GM set for the initial public offering. The stock traded for less than a dollar when the company filed for bankruptcy last year.
On the floor of the New York Stock Exchange, a crowd eight deep jostled around the company's trading post, adorned with its familiar blue-square logo with an underlined "GM." CEO Dan Akerson rang the opening bell as raucous cheers went up and the sound of a Chevrolet Camaro's revving engine echoed through the room.
The government hopes that the stock offering will be the first step toward ultimately breaking even on the bailout. For that to happen, the government needs to sell its remaining GM holdings for an average of roughly $50 a share over the next several years.
In the initial offering, the government reduces its ownership stake from 61 percent to 33 percent. The federal Treasury is unloading more than 400 million shares of the resurrected GM, which is smaller -- but cleansed of most of its debt. The company is making money.
"There's a lot of work to do, but today is the beginning of the new company," said Mark Reuss, GM's North American president.
(Excerpt) Read more at latimes.com ...
This is the pump. Next comes the dump.
Since We own the company......when should I expect my check?
I guess I just don’t get it. If the IPO money is being used to partially pay back the taxpayers, what will GM use for operating capital and to pay into the pension fund? What of the stock shares the government will still own?
(signed) confused
Isn’t this the second public offering??
Exactly.
It’s easy to make money off the IPO.
Wait a year or few until the UAW begins to ask for concessions and GM starts to tank under the same burdens as “old” GM.
Only an idiot would forget what happened to the last GM investors.
Did China buy up all the stock yet?
It will be col cold day in h—, before I ever buy another GM product.
There are investors who want to invest in something that will make a good return, and not many offerings to choose from. Other recent IPOs have done well, GM will blow the doors off. Where else are you going to put money? Into insurance companies? Healthcare? Pharma? Housing? Airlines?
Naked body scanners, the next big thing!
Little has changed with GM. Basically they're just rearranging the deckchairs on the Titanic. Their cars are still crap. The Volt is a joke. The UAW has more power over them now than ever before.
Anyone who 'invests' in them are idiots. Period.
Yup. The first one was over 100 years ago. So it technically isn't an IPO.
RE: Did China buy up all the stock yet?
What do you think would happen to the Unions and their demands if China were to own all of GM?
The important thing is to “dump” before they do. I remember the “IT IPO” days. I got in on one at $25 and held on after 2 or 3 splits. It was up to $225! My broker said, “hang on! It’s not going anywhere”. It went to less than $2 before I dumped. Out of business now. If you make a reasonable sum, dump. Don’t get greedy and don’t hang onto a stock like this for “the long haul”.
Less than 22.00 by next Wednesday.
They were interviewing a spokesman this morning on Fox and Friends regarding this.
According to the article this is who gets the IPO:
1)Institutional investors (pensions 401ks etc)
2)Employees & retirees of GM (the unions)
3)SAIC (China)-- So let's guess where any new GM factories will be built. Just a guess on my part but it won't be Detroit or anywhere else in the US.
The spokesman was asked the following question:
What about the individual investor who owned the stock and rode it all the way down until the bailout??
ANSWER: Those shares are worthless and the individual gets nothing for them. The president felt it would be in the long term interest of the country if GM were not allowed to go bankrupt.
So bottom line: The taxpayer was on the hook for rescuing this company and now doesn't even get the option of buying the IPO since it will not be available to the retail investor.
I'm no expert on the market so correct me if I'm wrong but this seems to mean that favored investors get the IPO on the "ground floor", once the price runs up they'll be able to sell it and reap the profits, while the individual investor won't get in until after the price run up. Does that seem right to you?
” Their cars are still crap. The Volt is a joke.”
...I expect that Obama will mandate that the government use GM vehicles...especially the Volt...that will prop them up for a short while...then they’ll go back into the toilet.
” This is the pump “
Who’s doing all of the buying?? I’m guessing it isn’t the ‘retail’ investor —
More likely the Wall Street ‘usual suspects’ using Free Money from the Fed....
...GM opened at $35.00....last trade was @$35.51 11:07am...high for the day so far $35.99
You got it right.
I’m thinking that when this goes “truly” public it won’t look so good. Especially after this opening day rise when everyone looks to bail out high.
Investing in GM is investing against America. Oddly enough. I mean - if this IPO works (short-term) then the Feds use the example to do it a lot more often; which is not a good thing, IMHO.
I’ll never buy a GM product. Period. And I hope the next time they fail Congress won’t be so quick to jump on the Fear Wagon®.
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