When General Motors Corp. emerges from bankruptcy protection, it will technically be a brand new, privately held company — yet it will be more publicly owned than ever, with taxpayers holding a 60 percent stake.
GM executives say the company will continue to release regular financial statements after it goes private, even though technically it will no longer have an obligation to do so.
“There will continue to be a significant level of disclosure,” Chief Financial Officer Ray Young told Detroit radio station WJR-AM today. “In fact the new GM will be the most public private company.”
The Detroit automaker filed for bankruptcy protection on Monday and is hoping to emerge in 60 to 90 days, smaller, leaner and less burdened with debt. Its ownership structure will completely change: The Treasury Department, which is bankrolling the bankruptcy with $30 billion, will own 60 percent, while the Canadian government will take 12.5 percent in exchange for its financing.
GM’s other stakeholders will include the United Auto Workers, with a 17.5 percent stake, and GM’s bondholders, who will get a 10 percent share. GM’s current shares are expected to become virtually worthless once the company sells its best assets to a “New GM” and liquidates the rest in bankruptcy court.
Without publicly traded shares, the automaker will no longer have to file regulatory documents that disclose quarterly earnings, major business transactions or executive compensation — even though as a nationalized company it will be more publicly owned than ever. (AP)
