The U.S. government and the United Auto Workers retiree health care
trust plan to sell a total of 50 million shares of General Motors Co. stock this
week, marking the next step in the automaker's exit from government ownership.
The Treasury Department announced Wednesday that it would sell 30 million shares in a public offering tied to GM's return to the Standard & Poor's 500 Index, which is expected to happen after the market closes Thursday.
The UAW trust will sell 20 million shares as part of the offering.
"We appreciate the opportunity to assist in this offering made possible by our rejoining the S&P 500," GM Chief Financial Officer Daniel Ammann said in a statement. "Our focus remains on continuing the progress we are making in the marketplace with world-class cars, trucks and crossovers."
Some analysts expected the government and UAW to consider selling shares after Standard & Poor's announced GM would return to the index this week, four years after it was removed on the eve of its bankruptcy.
Index-based investors will be required to buy GM shares when it joins the S&P 500 and S&P 100.
Barclays estimated that the S&P decision would lead investors to buy 78 million shares of GM stock.
After the offering, which is being managed by Citigroup, JPMorgan and Morgan Stanley, the U.S. will continue to sell GM shares on a daily basis until it sells its final GM shares in early 2014.
The government is expected to lose more than $10 billion on its $49.5 billion GM bailout. At the end of the first quarter, the U.S. still owned about 16 percent of GM, down from 26.5 percent in late 2012.
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