por admin » Vie Jun 11, 2010 7:06 pm
Morgan Stanley y JPM estaran a cargo de sacar las acciones de GM al mercado.
Morgan Stanley, JPMorgan Said to Lead GM’s Stock Sale
By David Welch
June 11 (Bloomberg) -- Morgan Stanley and JPMorgan Chase & Co. are expected to lead General Motors Co.’s initial public offering that may have the U.S. reducing its ownership as soon as this year, people familiar with the matter said.
At least five investment banks competed to handle the sale, which may be worth as much as $12 billion, making it the second- largest in a decade. Morgan Stanley and JPMorgan, both based in New York, would be responsible for writing the prospectus and promoting the shares to potential investors, said two people who asked not to be identified because the decision isn’t final.
Returning GM to public ownership will allow the U.S. to reduce its 61 percent stake and harvest returns on its $50 billion investment in the nation’s largest automaker. Choosing a lead bank in June means Detroit-based GM may hold an offering in the fourth quarter, people familiar with the matter have said.
“The government wants out as quickly as possible, but they also want to tell the public it’s a good deal,” David Cole, chairman of the Center for Automotive Research in Ann Arbor, Michigan, said in an interview. “They will want to be out before the presidential election in 2012.”
Mark Paustenbach, a spokesman for the Treasury, declined to comment, citing a department statement yesterday that said federal securities laws preclude it from discussing the identity of potential underwriters before a registration statement is filed with the U.S. Securities and Exchange Commission. A GM spokeswoman, Renee Rashid-Merem, also declined to comment.
Automotive Lending
GM Chief Executive Officer Ed Whitacre wants the company to have an automotive-lending unit before going public, people familiar with the plan have said. GM hasn’t had such a subsidiary since former CEO Rick Wagoner sold 51 percent of GMAC to private-equity firm Cerberus Capital Management LP in 2006.
Chief Financial Officer Chris Liddell said May 17 the automaker’s first-quarter net profit of $865 million was a “good, useful step” toward an initial offering. He said that the stock sale may not come until 2011 and that it wouldn’t be necessary to control a financing unit before going public.
The banks’ expected selection was reported earlier by the Wall Street Journal.
GM’s choice will be “subject to Treasury’s agreement that the selection is reasonable,” the government said yesterday in a statement. The Treasury and GM are expected to sell shares, and other holders may participate, the government said.
IPO Timing
The timing of the offering will depend on GM’s profitability, the health of the economy and the state of capital markets, said three people familiar with the matter.
“It will happen when the markets are ready and when the company is ready,” Liddell said May 17 on a conference call.
The sale may raise as much as $12 billion, an estimate by Independent International Investment Research Plc showed.
GM’s equity is worth $70 billion, according to a May 20 report by Eric Selle, a JPMorgan debt analyst who projects a return of 47 cents on the dollar for holders of bonds issued by GM’s predecessor, General Motors Corp., that will be converted to stock and warrants in new GM. At today’s bond prices, GM’s implied equity value is about $47 billion.
Since 1999, four U.S. IPOs have exceeded $5 billion -- Visa Inc.’s $19.7 billion deal in 2008, AT&T Wireless Group’s $10.6 billion offering in 2000, Kraft Foods Inc.’s $8.68 billion deal in 2001 and United Parcel Service Inc.’s $5.47 billion sale in 1999, according to data compiled by Bloomberg.
The size of the sale hasn’t been determined yet, said one person familiar with the plan.
Bankruptcy Emergence
GM emerged from bankruptcy in July with its ownership split between the old bondholders, the U.S., Canada and a trust to cover health care for union retirees.
The U.S. government’s current net investment in the automaker is $42.2 billion, according to a senior official in President Barack Obama’s administration. GM has repaid $6.7 billion in loans and paid $600 million in interest and dividends. The U.S. also holds $2.1 billion in the company’s preferred shares.
“When we did this restructuring we never expected a full recovery of our investment,” Steven Rattner, the former head of Obama’s automotive task force, said May 10 in Detroit. “If it ends up costing us $10 billion, we should consider it a success.”
For the Treasury to break even, the value of GM would need to rise to about $80 billion after bondholders and the UAW’s health-care trust exercise stock warrants that dilute the U.S. ownership.
Lazard Advice
The Treasury has hired Lazard Ltd. for $500,000 a month to advise on selling its stake, according to a document on the department’s website. Evercore Partners Inc. also is advising GM on the selection, a person familiar with the matter said.
GM and Treasury officials met with senior executives from Goldman Sachs Group Inc., Bank of America Corp., Citigroup Inc., JPMorgan and Morgan Stanley last month in Washington about hiring a lead bank, said one person familiar with the matter.
The Treasury said yesterday that it will determine the underwriters’ fees, which finance professors at Cornell University and Georgetown estimate may be as low as 2 percent. That would be less than any U.S. IPO over $5 billion since 1999, Bloomberg data show.
“General Motors is a government entity now, and the banks that may underwrite the deal were government entities or got help from the government,” said William Smith, president of New York-based Smith Asset Management, which used to own shares of GM. “I imagine with the IPO they’ll do the politically correct thing and keep fees down.”
Choosing a lead underwriter now allows GM to file an S-1 initial registration form as soon as July and sell shares in October or November, a person familiar with the matter said.
GM management has been preparing for an IPO so they will be ready whenever the timing is right, said a GM executive who asked not to be identified discussing internal matters.
Whitacre was installed as chairman by Obama’s task force when it replaced more than half of the directors in July.