China's SAIC considering stake in GM: report
New York (AFP) Sept 20, 2010
China's largest automaker, SAIC, is considering buying a stake in General Motors when it reverts to a public company in the coming months, the Wall Street Journal reported Monday on its website.
SAIC, which has built vehicles with GM in China since the 1990's, "hasn't decided whether to participate in the initial public offering but has expressed interest in doing so," the WSJ reported, citing "people familiar with the matter."
The initial public offering, which is expected shortly after the November 2 midterm elections, will allow the US Treasury to begin to wind down the government's 61 percent in GM.
Treasury officials are concerned about public criticism if a Chinese company were to take a major stake in the American industrial icon, the WSJ reported.
Spokesman for GM and the US Treasury contacted by AFP declined to comment.
The federal government obtained the stake after injecting 50 billion dollars of taxpayer money into the troubled automaker as it was restructured under bankruptcy protection last year.
GM's new chief executive officer Dan Akerson said last week it will likely take "a couple of years" for the US government to fully unwind its stake.
The Treasury Department issued a statement Friday asserting that its duty is to "maximize the return to taxpayers" and that it will wind down its stake "as soon as practicable."
"We expect that potential investors will be sought across multiple geographies with a focus on North American investors, in line with what is typical in similar transactions," the statement read.
"We expect that a large and diverse group of institutional investors will be offered an opportunity to participate, with no single investor or group of investors receiving a disproportionate share or unusual treatment."
Other US investors have expressed interest in buying major stakes in GM, the WSJ reported.
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