General Motors Co. raised by 31% the number of shares being sold in the IPO for its common stock, to up to 549.7 million, as the UAW Retiree Medical Benefits Trust and the Treasury Department increased the amount of their GM shares they will sell, according to a filing Wednesday with the Securities and Exchange Commission.
The IPO would increase to up to 36.6% from 28% the amount of GM stock that would be publicly traded.
GM still estimates a price between $32 and $33 a share, the same figure it projected Tuesday. The new offering would raise potentially $22.7 billion.
The $45 billion UAW Retiree Medical Benefits Trust, Ann Arbor, Mich., increased the number of shares it is selling by 25% to up to 102.3 million shares, potentially raising $3.38 billion.
Eric Henry, chief investment officer of the UAW trust, a voluntary employees beneficiary association, couldn’t be reached for comment on how the proceeds would be invested.
The Treasury Department increased the number of shares it is selling by 36% to up to 412.3 million shares.
Canada GEN Investment Corp., a wholly owned subsidiary of Canada Development Investment Corp., kept the number of its shares it is selling at up to 35 million shares.
General Motors won’t receive any of the proceeds from the sale, expected Thursday, of the common shares. It would receive up to $4.6 billion in proceeds from the concurrent sale of 92 million shares of convertible junior preferred stock it is issuing as part of the IPO. GM estimates a $50 maximum price for the preferred shares.
The rise in the common offering will reduce the ownership stakes in GM of the UAW VEBA and the Treasury Department.
After the sale, if all the overallotments are exercised, the publicly traded portion would represent 36.6% of GM stock, while the UAW VEBA stake in GM would fall to 10.7% from 17.5%; the Treasury’s stake to 33.4% from 60.8%; and the Canada GEN stake, to 9.3% from 11.7%. The holdings of Motors Liquidation Co., an entity set up to resolve creditor claims and liquidate predecessor General Motors Corp.’s remaining assets and liabilities, would remain at 10%. The ownership stakes excludes potential stock from warrants held by the UAW VEBA and Motors Liquidation.
GM will be added to the Wilshire 5000 stock index Friday, if the IPO is completed by then, Wilshire Associates announced Tuesday in a statement.
The IPOX Global Composite index plans to add GM as soon as the offering is completed, said Josef Schuster, CEO of IPOX Schuster, developer of the index, which has 2,200 companies and $2.5 trillion in total market capitalization.
Mr. Schuster expects portfolio managers and analysts to classify GM as a growth stock rather than a value stock because of its large presence in emerging markets China and Brazil and also because “GM is not going to pay a dividend as value stocks do,” he said.
