General Motors IPO to lead the biggest IPO boom On the back of mixed auto markets, General Motors’ plan to file an IPO succeeds, making it the biggest IPO in global history. General Motors Headquarters GM IPO: Walking the path of progress General Motors, one of the world’s leading auto manufactures recently unleashed its stocks in an initial public offering. The major step taken by this auto manufacturing giant indicates that the company is in the expansion mode and plans to raise cash through an IPO while earning back its credibility, which was shaken during the times of recession, pushing the company to file bankruptcy. GM's IPO could be the biggest since Visa’s $19.7 billion offering released in March 2008, and could raise up to $20 billion. However, analysts cautioned that its size depends on yet-to-be-tested investor demand for a well-nourished automaker that has posted profits for two consecutive quarters. GM Share Trading Trading in GM shares is expected to start during the Thanksgiving holiday season, sometime between late October and November 25. A stock offering in late October indicates that trading would begin right before the November congressional elections. Conversely, the government officials and GM executives continue to deny the possibility of any linkage of the IPO filing with the elections. GM also plans to add a stock listing in Toronto along with New York as it would underscore the junior roles played by Canada and Ontario governments to the US Treasury in keeping GM away from liquidation. Meanwhile, GM has indicated that the new common stocks will not be sold in the IPO but the preferred shares can be involved. This kind of an offering is a relatively safer form of equity that could pull more investors and profit. A group of leading underwriters will review the performance of GM IPO and the panel will include underwriters from Morgan Stanley, JPMorgan, Bank of America Merrill Lynch and Citigroup Inc. Hence, it seems that GM has chosen an ideal path to get hold of its missing assets and reputation. The IPO filing activity is likely to induce new opportunities and new customers for the company. General Motors goes Green General Motors has been striving to bring back the good old days when the company was recognized as one of the most efficient auto making companies. General Motors’ next plan after filing an IPO is to become the world’s most fuel- efficient auto manufacturing companies. GM has taken certain positive initiatives to achieve the set target. The company has adopted a green technology that can increase the miles-per-gallon figures for the benefit of the customer. The company is also planning to introduce the hybrid electric cars to meet customer requirements for the environment-friendly cars that monitor and control the fuel burnout and keep the engines clean. However, these cars are not very cost-effective and the decision of going green could prove as an ill- timed mistake for the company. GM will roll out eight hybrid models by next year to help boost the fuel economy and its own image that is stuck up amid pessimistic consumer perception. GM also aims to launch diesel-efficient car models in the coming future. At present, the company has launched 6-speed cars with automatic transmissions with its co-developer Ford Motor Co. The launch of their 6-speed sedans has replaced their 4-speed transmission models that were running till date. The road ahead In the view of analysts, IPO filing has helped GM to recover and grow sales in the US auto market. Despite marking profits in the home country, the company is going through a rough patch in the European auto division. As far as global markets are concerned, GM is growing gradually on sharply lower costs. GM aims to move more than half of sales volume to global platforms by 2014. This new strategy may help boost company sales for more than 17% from now and allow GM to cut costs and trim down complexity in its manufacturing operations. Thus, GM is hopeful about the coming future and fresher opportunities that may help the company to restore its position with better and sustainable profits. ts.
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