Barron’s (August 21)
General Motors (GM) is preparing for an initial public offering (IPO). This is not just any IPO. President Obama has pledged that taxpayers will get their entire $50 billion investment back. Barron’s is not optimistic. “We figure that the company’s market value could be around $66 billion, or $118 a share.” That would value GM higher than Ford or Daimler, but “it would take a price of around $135 a common share” for taxpayers to get their full $50 billion back.
Bloomberg (June 2)
Another one bites the dust. By yearend, Ford will end its Mercury brand. Sales of the 77-year old brand peaked in 1978 at 579,498, but fell to 92,299 in 2009. Mercury joins other departed Detroit brands including Pontiac, Saturn, Oldsmobile and Plymouth. Going forward, Ford will focus on its namesake Ford brand and high-end Lincoln brand. The only U.S. automaker not to accept money from the government’s TARP program, Ford earned $2.7 billion in 2009 and expects to be solidly profitable in 2010.
