It’s been three years since Obama administration has been part owner of GM and this time isn’t going to end soon.
The government, which has 26% stake in GM, declared that there is no timetable for giving up the Detroit carmaker. Since its $33 IPO in November 2010, GM’s stock has continuously fallen reaching Thursday, May 10th, $22.37, down seven cents.
“Our perspective is that the company has made real progress, but the market hasn’t given them as much credit for that as it might,” said Tim Massad, the assistant Treasury secretary.
Last October government said it will exit GM as soon as it’s practical. At the current prices, exiting GM would make government lose more than $15 billion on the $49.5 billion bailout. Gm is frustrated with this slow exit and last June Dan Akerson, GM’s CEO, declared that he hoped government would be out by the middle of 2012. In order to break even, the Treasury needs to get $53 on average for each of its 500 million shares in GM stock.
“We have to balance maximizing recovery for the taxpayers with the speed of exit,” Massad said.