GM IPO to be largest in US history after shares hike

NEW YORK: General Motors on Wednesday announced a hike in the number of shares in its stock listing, which puts the US auto maker on track to rebound from bankruptcy with the largest public share offering in US history.

The largest US auto maker said it would sell 478 million shares instead of the 365 announced previously due to strong interest by investors, for a price between 32 and 33 dollars per share.

The offer could pull in 22.4 billion dollars for GM, making it the largest IPO in US history, taking into account options for issuing supplementary shares.

Credit card giant Visa currently holds the record with its blockbuster IPO 19.7 billion dollars in 2008.

GM is returning to public trading on the New York Stock Exchange after an 18-month hiatus. The NYSE delisted GM after the company filed for Chapter 11 bankruptcy protection on June 1, 2009. It emerged a month later with the government owning a controlling stake.

The price range of 32 dollars to 33 dollars represents an increase of as much as 27 percent from the November 3 estimate of 26-29 dollars.

Once the world's largest corporation, GM sold more vehicles than any other automaker from 1931 through 2007, after which it lost the crown to Japan's Toyota.

Hit by falling sales amid a steep US recession, GM was forced into the government-backed bankruptcy reorganization after receiving billions in emergency aid.

The auto maker transferred its main assets to a new government-supported car company under a plan financed by the Obama administration and the Canadian government.

The US government owns a 60.8 per cent stake in General Motors Company, the Canadian and Ontario governments have an 11.7 per cent holding, and the United Auto Workers union's retiree health care trust fund owns a 19.93 per cent stake.

With the IPO, the US Treasury's stake is expected to fall to 40.6 per cent.

The embattled US auto industry has been showing consistent gains so far this year amid a US economic recovery that began in July 2009 from the worst recession since the 1930s.

And a successful IPO would provide a victory for President Barack Obama as his administration moves beyond an election "shellacking" fueled -- in part -- by anger about economic policies, including the bailout.