General Motors Spends $3.9B To Redeem Preferred Stock
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DETROIT (CBSDFW.COM/AP) — General Motors Co. says it has completed the planned $3.9 billion purchase of 156.1 million shares of preferred stock.
The Detroit-based automaker sold cheaper debt to pay for the purchase. GM spokesman Tom Henderson said Wednesday that the deal improves the company's cost structure.
GM has now redeemed all Series A preferred stock from the UAW Retiree Medical Benefits Trust and Canada Gen Investment Corp. The trust provides health benefits to retired autoworkers and the investment corporation manages the Canadian government's investment in GM.
The trust got the shares after GM emerged from bankruptcy to help pay the company's retiree health care costs. GM bought back some preferred stock last year.
GM will take an $800 million charge in the fourth quarter for buying back the preferred stock.
Just last year General Motors invested more than $500 million to improve its Arlington assembly plant. The GM $200 million stamping facility presses out components of the company's line of new full-size SUVs, the Chevrolet Tahoe & Suburban, GMC Yukon & Cadillac Escalade.
(©2014 CBS Local Media, a division of CBS Radio Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)
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