December 21, 2012

Jenner & Block represented General Motors in connection with its $5.5 billion share repurchase transaction, which was publicly announced on December 19, 2012.  In a press release, GM stated that it would purchase 200 million shares of its common stock held by the U.S. Department of the Treasury for $5.5 billion, or $27.50 per share.  The repurchase price of $27.50 per share represents a 7.9 percent premium over the closing price on December 18, 2012.  The share buyback closed on December 21, 2012. 

Government ownership of GM stock was the result of the auto industry rescue that began under President Bush in 2008 and was expanded by President Obama in 2009.  After the repurchase, Treasury will continue to own approximately 300 million shares of GM common stock, or approximately 19 percent of the outstanding shares on a fully diluted basis.  However, in announcing the share buyback on December 19, the Treasury also announced its plan to fully exit its entire holdings of GM stock within 12 to 15 months. 

This transaction is extremely important to GM from a strategic perspective, as it effectuates a further government divestiture of its holdings in the company.  The General Motors press release quoted GM Chairman and CEO Dan Akerson as saying, “This announcement is an important step in bringing closure to the successful auto industry rescue, it further removes the perception of government ownership of GM among customers, and it demonstrates confidence in GM’s progress and our future.”  

The Firm’s transactional team on this matter was led by Partner Joseph P. Gromacki and included Partners Brian R. Boch, Daniel R. Murray, Andrew J. Olejnik, Jeffrey R. Shuman, Michael S. Terrien, William L. Tolbert, Jr., Michael T. Wolf and Elaine Wolff and Associates Christine K. Bedi, Ian N. Bushner, Christopher J. Fisher, Mercedes M. Hill, Michael J. Kelly, Adam R. Kreis, Sarah R. McNally, Marc A. Roualet, Benjamin J. Sauer and Carl N. Wedoff.

Litigation-related advice on issues arising in the context of this transaction and certain other matters was provided by Partners David J. Bradford, Anton R. Valukas and Bradley M. Yusim and Associates Anthony B. Borich, Andrew J. Herink, Elin I. Park, Paul B. Rietema and Shaun M. Van Horn.