On Wednesday, Wall Street saw financial services firm Morgan Stanley’s stock ticker welcome back General Motors, and with good reason.
GM has made a comeback and has now opened itself up to the stock market, selling an incredible amount of shares, which is large enough to qualify as what may be the second largest initial public offering in the US ever.
GM sold roughly 478 million shares yesterday at an impressive $33 a share, up from the $26 the automaker was originally hoping for.
As a result, the trade will help GM raise more than $20 billion and cut its debt to the US government — who shelled out over $49 billion in an attempt to bail out the desperate motor company — by nearly half.
The news revealed the first steady profits for GM in more than six years.
Already, the US Department of the Treasury has decided to pull back its stake in the company down to 26 percent from 61 percent.
While the department must sell its remaining 500 million shares at an average price of $53 per share to break even, experts are optimistic in the financial future of GM.
Taking a step back from all the number crunching could display several things to be learned from all this.
Even if it was arguably a product of luck, it was a risk worth attempting on the part of the government to invest in a bailout.
Amid all the criticisms of President Barack Obama’s administration, it may be difficult to identify anything deserving of praise, but this could be one piece of news that would qualify.
It’s fair to acknowledge that the other automaker operating on taxpayers’ funds — Chrysler Group LLC — has yet to come to as respectable terms, but both GM and Chrysler have driven out cars better in quality than what Americans and the world has seen from them in a long time.
For this, commendable are their efforts to make products that Americans once again desire — and products that prove those who believe that the US can’t make cars that are worth driving wrong.
