Okay let me get this straight... our federal government BAILED OUT General Motors with our taxpayer money because they were our beloved American automaker right?! And now our federal government is ALLOWING China's motor company to buy into General Motors?!? Can any of you see something wrong with this picture?! So what if it's only 1%. That's how it starts. Soon enough GM will no longer be an American automaker!!! So what was the point in bailing out a publicly traded company that should have been allowed to go through bankruptcy and restructuring?! Oh that's right, Obama faced quid pro quo with his labor union buddies. I can't believe the feds are allowing this deal to go through.
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Reuters news
written by Kevin Krolicki, Soyoung Kim and Clare Baldwin
Sunday November 14, 2010
(Reuters) - China's SAIC Motor Corp Ltd (600104.SS) has reached an agreement in principle to take a stake in General Motors Co (GM.N) if Chinese regulators approve a deal to deepen an existing alliance between the two automakers, three people familiar with the matter said.
The potential investment from SAIC is part of a surge in investor interest in GM that expected to push the pricing of its shares to $29 or above in the U.S. automaker's initial public offering, one of the sources said.
China's government would have to approve the SAIC investment before Wednesday for it to go forward as part of GM's IPO, the sources said.
The amount of the proposed investment by China's top automaker was not immediately clear on Sunday.
Negotiations between the two sides have focused on an investment of $300 million to roughly $1 billion in a move that would help cement agreements for increased cooperation between the automakers.
An investment of just over $500 million would represent about 1 percent of the common stock in GM if the IPO prices at the high end of the proposed range this week.
GM had no comment. SAIC representatives could not be reached immediately for a comment.
Talks between the two sides have been under way for more than two months and have covered a range of topics including the deepened cooperation in the development of electric vehicles and support for SAIC's ambitions to move beyond the China market, sources have said.
The deal is now awaiting approval by China's Ministry of Commerce, one of the sources said.
At one point last week, U.S. and Chinese officials became involved in the discussions between GM and SAIC, the person said.
That reflects the government ownership stake in both automakers and the potential U.S. political sensitivity around a Chinese investment in GM, a company still seen as an icon of American industry, the person said.
Until this week's expected IPO, the U.S. Treasury will hold almost 61 percent of GM as a result of the Obama administration's decision to fund the top U.S. automaker's restructuring in a 2009 bankruptcy.
The U.S. Treasury had no immediate comment.
The discussions between GM and SAIC remain private and the top U.S. automaker remains in a quiet period because of securities regulations related to its IPO.
For that reason, the sources were not authorized to discuss the negotiations between SAIC and GM publicly.
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