General Motors – Government Motors to U.S. citizens –
will be kicking the taxpayers in the sac.
The automaker plans on buying back its remaining shares. The Weekly Standard reported the following:
The American taxpayers stand to lose billions
as General Motors today announced a plan to buy back 40 percent of the company
owned by the federal government."The Detroit automaker said it will purchase 200 million shares of GM stock held by Treasury for $5.5 billion — or $27.50 per share — nearly $2 above the stock's closing price on Tuesday," the Detriot News reports.
However, the break even price — the price that GM would need to pay for each share in order to pay back the money the government put in to the company —was $53 a share. That number has now risen dramatically.
"As a result of GM’s buy back, the government has recovered about $28.6 billion of its $49.5 billion GM bailout, which means it will most likely lose billions when selling its remaining shares," MLive.com reports. "The government would need to sell its remaining shares at a price of $69.72 to break even. That’s up more than $15 from earlier this year, when the U.S. Treasury would have to sell its 500 million remaining shares at about $53 per share."
Remember that the next time you plan on purchasing your next vehicle.
Source: http://www.weeklystandard.com/blogs/taxpayers-lose-billions-gm-buys-stake-back-government_690683.html?utm_source=twitterfeed&utm_medium=twitter
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