Report: U.S. Treasury May Sell More GM Shares This Summer

According to a report from CNBC, the U.S. Treasury may sell more of its shares in General Motors as soon as this June. The Treasury still holds a 33-percent stake in GM after helping it recover from bankruptcy.

However, CNBC reports that selling the shares now would result in a big loss for the government. The shares were initially valued at $33 in November 2010, but are now trading at $29.97 as of close Monday — nearly ten-percent lower than their value in GM’s initial public offering. The government may pursue the sale anyway, reportedly to divest itself of any connection to GM ahead of the 2012 elections.

GM posted $4.7 billion in net income for financial-year 2010, its first full-year profit since 2004. Sales for the first quarter of 2011 were up 23 percent year-over-year, and CNBC says that GM will report a first-quarter profit. It’s still unknown when and how many shares the Treasury would sell, but financial agreements mean they couldn’t do so before May 22. A sale could be announced in June or August, possibly with an additional sale in November or December of this year.

Source: CNBC

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