GMAC, the former division from GM, is getting another shot in the arm with the injection of $7.5 billion in exchange for shares from the company. The move is expected to be good news for all Chrysler and dealers, an issue that has been plaguing the headlines due to the car manufacturer’s restructuring intent.
The Treasury has already allocated 5 billion dollars to Gmac to increase its capital and 884 million dollars to GM to acquire Gmac shares. The American Treasury announced that it will ‘’soon” convert the 884 million dollars in privileged shares in ordinary shares, making it shareholder with a 35pct stake in Gmac. The 7.5 billion dollars loaned to Gmac include 4 billion which Gmac has to loan to Chrysler clients and dealers.
It looks like this development will address issues surrounding loans and the car industry. GMAC has been in sitting in pins and needles lately and with this new stimulus-plan like assistance from the US government, keep your fingers crossed that something should come out of it unlike the previous one which seemed to produce nothing beneficial for anyone.
(Source) AGI
Tags: billion dollars, car industry, car manufacturer, Chrysler, fingers, GM, GMAC, headlines, Loans, million dollars, stimulus plan, treasury