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GM’s SEC Filing on the Treasury Offer

    • So VEBA has preferred shares paying 9% (9% in an era of 1% CD rates) and these bondholders are agreeing to a few extra warrants. Fishy.

    • The devil is in the details. Many of which we will not be privy to. Closed doors, dark rooms.

    • General Motors bondholders are about to get hosed.

    • Relative to the UAW's terms, this is still gruesome, primarily for two BIG issues:
      1) We don't have a clue as to what "New GM" would look like. Does it include GM Asia Pacific? GM Latin America? etc. It appears to be a GMNA transaction, but that's not clear from the 8K that was filed.
      2) Warrants are exercisable "with an exercise price set at the share price that would equate to an aggregate equity value of $15 billion". But....If the stock was worth $15 billion, why wouldn't you just buy it on the open market? Where's the value in the warrant? Who did the Black-Scholes here?

    • Moral to the story is to stay away from buying stocks from UAW associated companies. Your money goes directly into their pockets.

    • Of course unsecured bondholders are going to agree to get ANYTHING over nothing in bankruptcy court. GM secrecy on details here is laughable. To know the SEC approves these filings just sickens me.

    • I've been tracking this story now for the last few months, and as the emphasis of discussions revolve around the bondholders, I have not seen much said regarding how current common shareholders are likely to end. Totally busted ? or will there be any residual value left on that 1% reserved for us shareholders with meaningful upside potential in the future. Should I sell now my 4,500 shares to recoup many cents on the dollar of my investment or wait for a better outcome many months or years into the future ? Can somebody can add any insights on this ... Thanks

    • You are kidding. I cannot believe unsecured bondholders are agreeing to this! I thought they would have stuck to their guns and received NOTHING!

      Garbage report by the Obamalama owned WSJ.

    • Ditto Armando. There is hardly a shred of detail in that filing. And it leaves me wondering, what are those bond holders that agree to this getting on the side. Government ups stake to 72.5% in a new offer. This "offer" is a joke just like the last one. It's actually terrifying that government thinks this is reasonable.

    • So if we (unsecured bondholders) were going to get 4 cents on the dollar before ... were still going to get 4 cents on the dollar with this deal ... even if we got stock why would we want to buy more? The big boys must be deep in it and desperate for this deal but it still stinks!

    • @ Higgsboson - Really?! "Obamalama owned WSJ"?! Maybe you missed the headline about Rupert Murdoch and Fox Corp buying the WSJ last year. Or maybe you missed the past century of history of the WSJ. Obama and the govt now own a lot of America, but not the WSJ.

      @Rickuack - Sell now although Im sorry that your commision will most likely be more than your actual proceeds. There is no equity value in the current shares. Its a wonder why they even trade. The only logical explanation is that $1.30ish is not a lot to pay for an option on a turnaround. If you do the standard back of envelope math that many sell side analysts throw out - 10 bln in normalized EBITDA (normal for when is anybodys guess) at a 5x multiple gives you $50 m in EV. With 27m in debt and preferred, that leaves 23m in equity. The govt gets 72.5% of that or 16.7 bln, the UAW gets 17.5% or 4 bln and the bondholders get the last 10% or 2.3 bln. Plus, at that level 23m, the bondholders will get a further 7.5% through warrants. Where are the old shareholders? Oops, the govt forgot about you. Or priced you out because they figured you're just a greedy hedge fund looking to profit from govt bailouts. Shame on you.

    • GM should be forced into bankruptcy. Its proceedings under court supervision is the fairest way for all parties to receive their share of the GM carcass.

      Interestingly, the billions of federal dollars that Barack Obama (and, to a much lesser extent, George Bush) pumped into GM and Chrysler have now been wasted. The aim for that money was to avoid bankruptcy. Yet, Chrysler filed for bankruptcy, and GM will soon do the same.

      Imagine the savings (to the American taxpayer) if both companies had been allowed to enter bankruptcy long before receiving billions of taxpayer dollars.

      As American culture devolves into Mexican culture (via massive illegal and legal immigration), we Americans will increasingly see stupidity of this kind. Our society will become just like Mexican society.

    • This deal is really a joke! Why don't they just sign a better offer with bigger bondholders, giving them the shares remaining from the "17,5% deal" with the Uaw, and let families and other little bondholders stay with their old bonds, avoiding to file for Chapter 11? This could also save taxpayers from giving more billions to finance a bankruptcy. Anyway, during the US lawyer President era many law firms will soon become even richer thanking for these many big bankruptcies.

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