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UAW Trust Fund to Sell 40 Million GM Shares
A United Auto Workers union trust fund is selling 40 million of its shares in General Motors Co., according to a GM regulatory filing.
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A United Auto Workers union trust fund is selling 40 million of its shares in General Motors Co., according to a GM regulatory filing.
Automotive News says the transaction, to be handled by underwriters Barclays and Citigroup, could jeopardize the trust’s right to a seat on GM’s board of directors.
The sale represents 29% of the GM stake currently held by the UAW Retirees Medical Benefits Trust, better known as VEBA. GM says it will buy back about $100 million of those shares.
VEBA acquired 87.5 million shares in “new” GM in 2009 as a part of the carmaker’s bankruptcy restructuring. The trust’s holding currently stands at 140 million shares.
The 2009 deal also gave VEBA a seat on GM’s board—as long as the trust retains at least 50% of the shares it gained at the time. AN says VEBA’s upcoming stock sale could jeopardize that seat if the 40 million shares sold are measured against the original 87.5 million shares rather than the trust’s current stake.
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