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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Elroy Jetson who wrote (5237)	4/3/2006 9:28:06 PM
From: elmatador	Read Replies (1) \| Respond to of 218621

GM hopes sale of car financing arm will help fuel its recovery General Motors is selling a 51pc stake in its GMAC financing arm to a hedge fund-backed consortium in a deal that will net the ailing car maker $14bn (£8bn). GM hopes sale of car financing arm will help fuel its recovery By David Litterick in New York (Filed: 04/04/2006) General Motors is selling a 51pc stake in its GMAC financing arm to a hedge fund-backed consortium in a deal that will net the ailing car maker $14bn (£8bn). After a process that has lasted almost six months, the majority stake in the business, which made a $2.8bn profit last year, will go to Cerberus Capital Markets. GM is trying to raise money to shore up its finances, which have been hurt by weak sales and growing healthcare and pension costs. It had been thought the process was in disarray, particularly after the company said last week that GMAC's most recent financial statements could not be relied upon due to accounting errors. Selling the stake and separating the car maker from its financing subsidiary is seen as a first step towards returning GMAC's credit rating to investment grade, which would give it access to cheaper capital. However, the major ratings agencies yesterday gave the deal a lukewarm reception. Christopher Wolfe, an analyst at Fitch, said: "We have improved GMAC's ratings watch to positive, but we're going to hold off on any change to their rating until the transaction is complete. A lot can happen in that interim." GM will reap an initial $7.4bn from the consortium, which also includes Citigroup and Japan's Aozora Bank. The deal will also yield a further $6.7bn from car lease and retail assets which GM will receive over the next three years. "This agreement is another important milestone in the turnaround of General Motors," said chief executive Rick Wagoner, who was backed by the board in yesterday's statement. "It provides significant liquidity to support our North American turnaround plan, finance future GM growth initiatives, strengthen our balance sheet and fund other corporate priorities." The 87-year-old finance unit has total assets of about $321bn, and financed leases and loans on 2.16m cars and trucks in 39 countries last year. The reorganized GMAC will have a 13-member board with six members appointed by the Cerberus group, four appointed by GM and three independent directors. Competition from foreign firms such as Toyota has eroded GM's market share. It struck a deal with unions last year to cap its pension and healthcare contributions, but faces potential liabilities from Delphi, the car parts firm it once owned, of up to $12bn. Delphi is taking legal action to try to invalidate its employee contracts. This could prompt a strike which, in turn, could cost GM huge amounts in lost output. Standard & Poor's said it may further lower GM's credit rating at any time. "We have become even more concerned about how developments at Delphi are unfolding," the agency said.

To: Elroy Jetson who wrote (5237)	4/3/2006 9:28:07 PM
From: elmatador	Read Replies (3) \| Respond to of 218621

Why foreign CEO's are Australians. The law in the US put in jail and have stiff fines for any CEO bribing foreign governments or foreign officers. This was a boom for Australians and New Zealanders. They've got this field only for themeselves. Hence: "the last two CEOs of McDonalds have been Australian" Look to the sucessfull Aussie business men: Alan Bond, that media bloke... they are ruthless people. Whenever I find projects and hear the Australian accent (if I discover there is also a Lebanese guy involved, the project means trouble.