General Motors’ IPO becomes the world’s largest-ever

, , , , , Global, NYSE, Over-allotment options... +3 more

General Motors Company (GM) announced on 26 November 2010 that the value of both the common and preferred stock sold in its IPO by its selling shareholders, including the US Department of the Treasury, reached US$23.1 billion, following the exercise of the over-allotment options under both offerings.

The underwriters were able to exercise in full both options, selling 71.7 million additional common shares at the offer price of US$33 each (representing US$2.37 billion) and 13 million additional 4.75% series B mandatory convertible junior preferred shares, at US$50 each (representing US$650 million).

The total amount of common and preferred shares sold under the GM IPO topped the US$22.1 billion issued by, and sold in, Agricultural Bank of China in October 2010 under a combined H and A share global offering with listings in both Hong Kong and Shanghai, and which made it, at the time, the largest IPO-ever.

The  IPO of GM was led by Morgan Stanley and JPMorgan, acting as representatives of the underwriters, together with Bank of America Merrill Lynch and Citi. Barclays, Credit Suisse, Deutsche Bank, Goldman Sachs and RBC Capital Markets also acted as joint bookrunners. Blackstone and Evercore acted as advisers to GM, while Lazard advised the US Treasury on the IPO. UBS, initially also included as a joint bookrunner of GM’s IPO, was reportedly dropped from the syndicate following an email allegedly sent by one of its research analysts to some 150 investors prior to filing, in contravention of SEC rules.

GM’s shares closed at US$33.80 in New York on 26 November, 2.4% above the IPO price. The US Treasuy still remains a 33.34% shareholder in GM.