By on June 12, 2010

The CBC reports that:

Ontario premier Dalton McGuinty said Friday his government will wait to see how General Motors prices its public share offering before deciding whether to sell its stake in the company.

McGuinty said the government needs to be “patient” and sell at the most profitable time.

The Canadian and Ontario governments own about 12 percent of GM. The US Treasury, which owns about 60 percent of GM has said that it expects to sell “some” of its GM stake during the IPO, which is expected to occur by the end of this year. In short, as Ken Elias predicts, GM won’t stop being “Government Motors” after it goes public. No matter how emphatically Ed Whitacre declares victory.

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11 Comments on “Canada Won’t Sell GM Stake In IPO… What About The US?...”


  • avatar
    HerrKaLeun

    regardless of how i hate GM. I can understand them waiting. any major stockholder would sell stock slowly since a quick sale of many stocks will depress the price. any stockholder also wouldn’t announce when exactly they intend to sell how much.

  • avatar
    wmba

    Sorry to have to provide a geography lesson, but Ontario is not Canada. It’s a province of the country.

    Your headline would be like saying “US won’t drill for oil” and the reader discovers the story is about the Governator and California, not the US as a whole.

    Difficult to grasp, I know.

  • avatar
    MikeInCanada

    True -Ontario is not Canada, however the Province did buy 4% of GM (along with the 12% bought by the federal gov’t).

    The real endgame here is that the Ontario government realizes that the equity position they hold is all but worthless – however until they sell it remains as an unrealized loss. They took quite a lot of political heat for bailing out one of the main constituents of the party – the Canadian Auto Workers – and the last thing they want to do is now have to explain how their ‘investment’ is pretty much worthless.

    The current Liberal government (yeah, that right ‘Liberal’ is actually a party here – consisting mostly of Toronto & Montreal) will sit on the shares until they get voted out and then the next party will have to deal with the fallout of selling the government’s equity position at pennies on the dollar.

  • avatar
    mikey

    Just a few more facts here. The Canadian Broadcasting Corp {CBC} would not exsist,were it not for taxpayer dollars being pumped in on a regular basis. They tend to be Liberal in thier views/news. For now we are federaly governed with a conservitive minority. So the CBC has to move a little farther right, so they can keep thier colective snouts in the trough.

    The {victim a day} Toronto Star, however sits SLIGHTY right of Chairman Mao or maybe Fidel Castro. I mean slightly!

    So take what you get from either one of those sources,with a grain of salt.

    Way back in the early nineties we elected a far left party, known as the NDP to govern Ont. The Americans would call them the “Loony Left” IMHO, a fairly accurate description.

    Well the NDP, the working mans hero, and all, decided to let GM of the hook for their pension obligations. Theory being GM was “too big to fail”

    We kicked them out 5 years later, and elected a far right party. Once again IMHO,every bit as scary as the loony left.

    Well sir,they slashed and burned and wrecked havoc in Ontario. Hey they even sold a highway,to balance the books. But not one of the far right a—holes had the balls to tell GM “ya better put some cash into your pension fund”

    We elected the McGuinty Liberals seven years ago and they ignored the GM pension issue. Then the fit hit the shan.

    The Americans bailed out GM. McGuinty the Liberal premier, and Harper the Conservitive Prime Minister,had a problem. A broke pension plan,and an American company that was going to pull out.

    25 thousand salary and hourly jobs gone 40 thousand hourly/salary pensioners all losing thier income.

    Who was going to pay the bills,to keep our socialist utopia alive?

    The Governments did what they had to do. It didn’t go over any better here than it did in the United States.

    And that boys and girls, is the reason we have elections.

    • 0 avatar
      RogerB34

      Mikey – really good reply.
      “… is the reason we have elections.”
      Problem is the Fools keep voting self destruction.

    • 0 avatar
      MikeInCanada

      We take voting for granted – so we don’t do it on a regular basis, or don’t fully appreciate the seriousness of participating in a democracy. Then we’re stunned when politicians don’t take the public interest seriously.

  • avatar
    Geo. Levecque

    I have to comment that the Liberal Party in Power in Ontario has nothing to do with Montreal, Quebec, granted there is another Liberal government in Power in the Province of Quebec and Montreal being its largest City, both Provinces and both Parties have nothing to do with each other, other than the Name Liberal, just like in British Columbia, they too have a Liberal Party government too. In Ontario case they have been known for giving a lot of Money over many years to GM Canada, jobs etc without much of a guarantee of getting anything back,that’s why Ontario is way deep in debt and they are bringing in a new Tax, much like the VAT that is in Europe on July 1st! To get more money from ordinary working people and let companies pass off there expenses to the ordinary working people, so GM Canada will gain and people working for them will pay and pay,nice eh?

  • avatar
    wallstreet

    Can we get a poll going to see how many readers are bullish or bearish on this pig? I’m in the mood to short this IPO unless the uptick rule stop me.

  • avatar
    mythicalprogrammer

    I think the stocks will go up. Dumping it now is the worst thing you can do, in my opinion. Buick brand seems to be doing well in China and will probably do well in North America. Cadillac have been reinvented so they’ll hold out for a bit. They got the Camaro so that’s pretty good. They’re also doing pretty well for themselves in emerging markets and especially in China. Wait for it and sell it at the right time.

  • avatar

    Hold on to your hats speculators. I would put the chances of success down in the 10% range. We now live in a global interconnected world information wise. The Saylor Lexus 911 call was a watershed moment for Toyota that raced around he world and focused a spotlight on their safety issues, costing them a ton of time and money. Lucky for Toyota nobody has been able to prove a direct link to them.

    My point here is that GM has lots of real safety issues that have not come to light in a front page story kind of way but they are getting very close and all it will take is one good recorded audio or video clip to do it. Does anyone think that GM would have faired as well as Toyota if the Lexus had been a Buick? There is no doubt in my mind that GM would have been finished. The following is an example of GM’s latest close call;
    http://wkyt.videogenesis.net/watch?v=9917

    There will be others – my guess is an electrical fire.

    • 0 avatar
      mythicalprogrammer

      With the recent debacle of Toyota un-intended acceleration. I doubt GM would repeat the mistakes of Toyota. Auto companies are having more recalls cause of the Toyota incidents. So if any safety issue that are reported, GM would most likely recall it right away instead of hiding it like Toyota.

      I doubt GM is that stupid >_>.

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