U.S. to buy huge stake in GMAC

[BeatleBoot]

Source: The Detroit Free Press

WASHINGTON — The U.S. Treasury will inject up to $6 billion into GMAC as part of a plan to shore up the finances of GM’s lending arm and the U.S. auto industry, the Bush administration said today.

Under the plan, the Treasury will buy $5 billion in preferred GMAC shares, paying an 8% annual dividend. It also will lend up to $1 billion to General Motors Corp. so that it too can buy additional equity in GMAC, which the Treasury could take on demand.


The Treasury said the money for the injection would come from the $700 billion financial industry bailout, and that GMAC would have to meet restrictions on executive pay as part of the deal.


The troubled lending arm won a key lifeline last week when the Federal Reserve said it could become a bank holding company, granting it access to the $700-billion financial industry bailout and other aid.




Read more: http://www.freep.com/article/20081229/BUSINESS01/812290...

[Zynx]

1. If all of these dividends actually hold up the Treasury will be taking in a pretty penny.

[Rebellious Republican]

2. Oh goody they are going to put some restrictions on CEO pay...

However what they are not doing is putting on any "Buy American" restrictions on our 700 Billion in tax dollars. No, they will be allowed to continue to outsource parts to foreign countries, in turn boosting some one Else's economy instead of our own. I am sure that our tax dollars could be better spent here at home where we all need it now. Put Americans back to work, thats what I would call a stimulus plan.

[Triana]

5. Exactly. This bailout shit isn't worth a plug nickel unless it has job and ...

...manufacturing protections built-in. Else, the money just goes out of the country.

[williesgirl]

3. These are the criminals who stole Symbolman's house. fuck them.

[Fire1]

8. Yeah, I remember that. I hope he's doing ok.

[Phred42]

4. Are they going to fire the board and Sr. Management as a condition?

[Hydra]

6. If Cereberus still owns that

That money just went into Dan Quayle's pocket.

[WriteDown]

7. I think Cerberus just gave up its shares to keep GMAC afloat...

They own like 17% now.