The national Canadian and provincial Ontario governments have agreed to sell 30 million shares in General Motors that they received in exchange for their contributions to the 2009 bailout of the automaker. The shares are worth about $1.1 US billion, and were purchased by the Bank of America and the Royal Bank of Canada as a block.
The transaction will be completed early next week. The sale reduces the Canadian governments’ stake in GM by 21%, down to 110 million shares. Canada and Ontario had been, since the bailout, the third largest stockholder in General Motors, behind the UAW and the U.S. Treasury, and after the sale will own about 8% of the company’s shares.
“As we said from the start, our investment in GM was always meant to be temporary as we worked to maximize the return to Canadian taxpayers,” Finance Minister Jim Flaherty said in a statement. “The government of Canada is committed to exiting from ownership of GM as quickly as feasible, while maximizing the return for Canadian taxpayers, as we demonstrated today.”
The banks purchased the shares at a discount from Tuesday’s closing price, $37 a share, up 28% from the start of 2013.