Jul02
GMAC is now a corporation, allowing share sales
NEW YORK (Reuters) -- GMAC said on Wednesday that it has converted to a corporation from a limited liability company, a move that could allow the auto and mortgage lender to sell shares to the public. In a regulatory filing, the Detroit-based company said holders of common membership interests in the former GMAC LLC on Tuesday received an equal number of common shares in GMAC Inc. It was not immediately clear when or if GMAC might sell shares to the public. A call to the company was not immediately returned. GMAC has received $12.5 billion of government aid since December, when it became a bank holding company, to combat mounting mortgage losses as well as falling vehicle sales. Some of that aid came in a May rescue package after regulator concluded that GMAC needed an $11.5 billion capital buffer following a "stress test" of its ability to weather a deep recession. That package left the government owning a roughly 35 percent stake. GMAC now is the preferred lender to customers of bankrupt automakers General Motors and Chrysler Group LLC. In a May 22 regulatory filing, GMAC said that if it were to go public, the Treasury Department would begin to liquidate its stake within seven years after an initial public offering, and try to shed 10 percent to 20 percent of its stake in each succeeding year. GM and private equity firm Cerberus Capital Management LP, the former owners of GMAC, were forced to shed much of their stakes as part of GMAC's bailout in December.
SOURCE: [ Automotive News ]
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