According to an anonymous source, the Canadian government has begun looking for an investment bank to sell the rest of their combined 140 million shares in GM, Bloomberg reports.
The source said that the government has not decided yet when it wants to sell the stake in GM, but on the same time, a report published by Sky News said that Canada asked some investment banks to make bids in the following days for the share-sale mandate.
In December, Finance Minister Jim Flaherty, said the Canadian government does not plan to be a long-term shareholder in General Motors. Canada has 140 million GM shares, or a 10 percent stake, with a value of $5.1 billion at the actual stock price (NYSE: GM – Aug 2 4:01pm ET – $36.95/share). After the US Treasury and the GM-UAW Voluntary Employee Beneficiary Association, Canada is the third largest sharehlder.
“The government of Canada remains committed to exiting from ownership of GM as quickly as feasible, while maximizing the value of the government’s interests for Canadian taxpayers,” said Kathleen Perchaluk, a spokeswoman for Flaherty.
Canada GEN Investment Corporation, which overseas Canada’s holdings for the two Canadian governments, already hired investment bank Rothschild Canada to give advice regarding the GM stake. The Ontario government owns one-third of Canada’s stake, and two-thirds is held by the federal government. The province of Ontario and Canada agreed to make an investment of $9.5 billion in GM, part of the automaker’s bailout in 2009. Until now they sold 35 million of their 175 million shares in the IPO.