TEXT OF INTERVIEW
JEREMY HOBSON: General Motors is driving back into the private sector. In the next 24 hours or so GM is expected to file final papers for an Initial Public Offering. That sale of shares to private investors would change Uncle Sam from a majority owner into a minority owner.
Marketplace’s Scott Tong is with us live from Washington to explain. Good morning.
SCOTT TONG: Good morning, Jeremy.
HOBSON: So are taxpayers going to get some money back here?
TONG: Some, but not all of it back at once. The government, during the bailout, put nearly 50 billion public dollars into GM. So far the company’s paid back about $10 billion or so, and another $7 billion would come from this share sale. As for the rest of the money, the Treasury hopes to sell more of its company stock down the road, hopefully at a higher stock price.
HOBSON: And who’s going to want to buy all of this GM stock?
TONG: Well that’s where it could get interesting. I spoke to Hans Greimel at Automotive News in Tokyo, about chatter that a big Chinese car company might buy in.
HANS GREIMEL: And of course that is a Chinese government owned automaker. So it raises the question of, “Hey, are we trading the U.S. government’s ownership in General Motors for partial ownership by the Chinese government?
HOBSON: An interesting twist, Scott. And how about GM — will it be easier to sell cars, do you think, if the government isn’t calling all the shots?
TONG: It certainly may help appearance-wise. They probably don’t like to be called — as you said earlier — Government Motors by snarky critics so this gives the perception that GM is back. It’s returning to the New York Stock Exchange. But one analyst I spoke to says the test is whether General Motors can be competitive in selling small cars.
HOBSON: OK we’ll be watching. Marketplace’s Scott Tong in Washington, thanks.
TONG: You’re welcome.
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