The US government Monday indicated it has
entered the final stages of divesting itself of partial ownership in
the country's premier car producer, General Motors.
The US Treasury Department said it had initiated the next step in
its plan to sell off its remaining 241.7 million shares "in an
orderly fashion" with a view to fully exit its GM investment within
the next 12 to 15 months.
The sale will be subject to market conditions, officials said.
The US government owned 61 per cent of GM - 50 billion dollars
worth - after the 2009 bailout to keep the company afloat during
bankruptcy reorganization. The Canadian and provincial Ontario
governments also helped in the bailout, owning 11.7 per cent of GM.
Auto union workers took on 17.5 per cent.
At the end of 2010, GM returned to the stock market and the
government reduced its ownership to 32 per cent. In December 2012, GM
repurchased 200 million shares of GM common stock from the US
government.
Treasury official Tim Massad said that the emergency support given
to GM through the Troubled Asset Relief Programme (TARP) "was
necessary to prevent the collapse of the American auto industry and
save more than 1 million American jobs."
GM has returned to profitable operations.
Rival Chrysler, the country's third-largest car maker, received
limited help from the government on the condition that Italian car
maker fiat take over the majority share. It is no longer operating in
the red.
Ford Motor Company, the second-largest car maker, kept its head
above water through the financial crisis and did not seek government
help.
Overall, TARP disbursed 419.4 billion dollars of taxpayer money to
keep banks and other companies afloat during the 2007-2009 great
recession in the US.
The government has since recovered nearly 94.6 per cent of the
bailout money, treasury officials said.
