GM announces planned share buyback of some UAW preferred shares
General Motors Co announced it would be repurchasing a little under half of its preferred shares in a healthcare trust. GM would be buying back the shares from the United Auto Workers Retiree Medical Benefits Trust. The 120 million Series A preferred stocks would be bought at USD 27 per share for an estimated total price of USD 3.2 billion.
GM said it would undertake a debt offering to finance the share buyback. While GM did not indicate what the target would be for the fundraising, the auto company did say it would be issuing unsecured notes with terms of 5, 10 and 30 years.
Of the USD 6.9 billion worth of total preferred shares, UAW owns 260 million shares valued at USD 6.5 billion. The remaining 16 million shares valued at USD 400 million shares are held by the Canadian government. GM may buy back the shares at USD 25 each on or after December 31 of next year.