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SOCIALIST REPUBLIC OF AMERICA
If this doesn't change your mind about obama and why we
have to get rid of him, we might as well change our name to SOCIALIST
REPUBLIC OF AMERICA.......WAKE UP AMERICA!!!!!!!!
Especially all of you GM stockholders.
GM Update This Is A Must Read For All
Here ya go – Obama bails out GM and sells controlling interest to
China. BOHICA
A sad state of affairs for American industry.
http://blogs.motortrend.com/inside-deal-sell-gm-chinas-saic-13985.html
By now, you've no doubt heard the news: General Motors' Chinese partner,
Shanghai Automotive Industry Corporation (SAIC) will take a controlling
stake in GM by purchasing the equity sold to the U.S. and Canadian
governments during the bailout. But what does it mean for the future of
GM?
The announcement was brief, cryptic and buried in the excitement over
the multitude of concepts and new vehicles GM has just announced it will
debut at theShanghai auto show in a few weeks. The press release reads
simply:
"Shanghai Automotive Industry Corporation (SAIC) and General Motors
(NYSE: GM) are announcing today that an agreement has been reached with
the governments of the United States and Canada that will allow SAIC to
purchase the shares of GM owned by the respective governments. The sale
is expected to be completed by this time next year pending approval from
U.S., Canadian and Chinese government regulators."
The implications of this announcement are enormous. The U.S. Treasury
currently holds a 26-percent stake in General Motors after selling
roughly half of its interest during the company's Initial Public
Offering in November 2010. The Canadian Government, meanwhile, holds
nine percent of GM stock after selling of 17.4-percent of its stake
during the IPO. Together, that's 35-percent of the company.
Should the respective governments sign off on this deal, SAIC will take
a 36-percent stake in GM (SAIC already bought a one-percent stake in GM
during the company's IPO), a controlling interest. In effect, GM will be
owned and under the control of SAIC, which will make combined company
far and away the world's largest automaker by volume. It goes deeper
than that, though. SAIC is owned and controlled by the Chinese
Government. If this deal goes through, GM will essentially be sold to
the government of China. How could our government let this happen? As is
so often the case, it's all about the money.
The "bailouts" of Chrysler and GM have been fairly unpopular with the
American public. Many have accused the government of overstepping its
authority and wasting taxpayer money propping up two companies who
failed in their own right, and this negative perception has dogged the
Obama Administration for years now. The Treasury gained some good PR
last year when it sold roughly half its stake in GM, but for many
opponents, it wasn't enough. With the 2012 election looming, the Obama
Administration is likely looking for a quick way out of this situation,
and it appears the Chinese made them an offer they couldn't refuse.
With GM's share price closing at $33.01 on Thursday, SAIC would have to
pay a minimum of $17.3 billion to buy all of the U.S. and Canadian
Governments' shares of GM, though the actual sale price will likely be
higher so the governments can turn a profit on the sale. But unless SAIC
offers the estimated $56 per share necessary for the U.S. and Canadian
Governments to break even on their investment in GM, the taxpayers are
going to take a bath on this deal.
Details regarding changes to GM post-sale are scarce right now, but the
deal will likely see current GM Chairman and CEO Dan Akerson leave the
company and replaced with SAIC chairman Hu Maoyuan and president Shen
Jianhua. GM's headquarters should remain in Detroit, but will answer to
Shanghai. Shanghai GM, SAIC's joint-venture with GM in China, will
likely be folded into SAIC down the road as it will no longer be
necessary under Chinese law.
Though the announcement comes as a shock, the warning signs seem so
clear now. Why GM kept Buick and killed Pontiac. Why the quintessential
American midsize car, the Chevrolet Malibu, is debuting in Shanghai. Why
the Chevrolet Cruze and Buick Regal were on-sale in China long before
the U.S. Why the Buick LaCrosse was designed in China and why China is
getting a Buick version of the Chevrolet Volt, along with a new plug-in
hybrid Buick SUV. A deal like this doesn't happen overnight, and it's
clear now that GM has been buttering-up SAIC for the past few years.
The only question is: Is a GM run by the Chinese Government a better
deal than GM run by the U.S. Government? We'll find out soon
enough.April 1, 2012, to be exact.
Read more: http://blogs.motortrend.com/inside-deal-sell-gm-chinas-saic-13985.html#ixzz1Ik50ZQMw |