GM gives IPO to employees, dealers

The disclosure by GM in a filing with the US Securities and Exchange Commission represents the first information on how the shares will be sold in the automaker’s IPO.

Morgan Stanley Smith Barney is administering a directed stock purchase program that GM has opened to about 600,000 workers, retirees and dealers.

GM was restructured in a 2009 bankruptcy with $50bn in US government funding.

Separately, the US Labor Department said it has given its approval to a plan conceived as part of bankruptcy for funding a trust fund affiliated with the United Auto Workers union that is paying for retiree health care.

That approval was another hurdle to clear for GM to move forward with its IPO since the UAW’s trust fund is another major shareholder along with the US government and the governments of Canada and Ontario.

A decision in the Federal Register will permit the UAW’s Voluntary Employee Beneficiary Association to hold GM common stock worth 17.5 percent and warrants allowing the trust to acquire another 2.5 percent.

The UAW’s VEBA will hold $6.5bn in preferred stock and a note for $2.5bn.

As of GM’s bankruptcy, about 751,700 former hourly workers and their dependents in the United States received retiree health benefits from the automaker.