The carmaker goes on with its “clean-up”, and after announcing it would sell the 7% owned in French carmaker PSA, Gm also cuts away from its former auto finance arm, for $900 million, after it has sold its remaining 8.5 % stake in Ally Financial Inc.
Ally, formerly known as GMAC, was a unit of GM until private equity firm Cerberus Capital Management bought a majority stake in the lender in 2006. Burned by bad mortgages that its subsidiary Residential Capital made during the housing bubble, Ally later received a $17.2 billion federal bailout.
GM said the transaction would result in a $500 million gain to be treated as a special item in the fourth quarter. The identity of the buyers of the unlisted Ally shares was not immediately known. A GM spokesman declined to disclose who purchased the stake.
Ally has taken steps to streamline operations since then, including selling many of its international businesses. In November, Ally sold $1.3 billion of unlisted shares to a group of investors, a transaction that helped enable the bank to make a $5.9 billion payment to the U.S. Treasury, which still has majority ownership. Ally has repaid around 70 percent of the taxpayer funds it had received.