The U.S. Treasury inked a deal today to sell 410,000 Ally Financial shares for $7,375 each ― 23% more than the $6,000-per-share price Ally snared when it sold stock to private investors back in November 2013, and 8% more than the $6,800-per-share price GM secured for Ally stock a few weeks after that.
Treasury has been working for the past year to exit its stake in Ally. Today’s sale would generate about $3 billion, reducing the agency’s stake to 37% from 67%.
In a statement, Ally called the Treasury move a “very positive outcome for the company and for the U.S. taxpayer,” adding that the “strong investor interest is a testament to the significant transformation of the company.”
Once the Treasury sale is complete, taxpayers will have recouped $15.3 billion, or 89%, of the $17.2 billion investment provided to Ally during the financial crisis. Treasury still holds 571,971 shares.
The government said it will continue to work with the company to further wind down its investment through either a public offering, private sale of common shares, or other alternatives.
In the fourth quarter of 2013, Ally completed a series of strategic actions, including raising common equity, achieving endorsement of its stress-test plan, gaining approval for the ResCap Chapter 11 Plan, returning $5.9 billion to the U.S. Treasury, reaching a settlement with the CFPB and the Department of Justice, and being granted Financial Holding Company status. These actions, coupled with the strength of its ongoing business, position Ally to complete its plans to exit TARP and continue to build upon what it called its thriving franchises, the company said.
Ally is the only remaining investment under the Automotive Industry Financing Program. Last year, the company completed what the government called an important restructuring plan, part of which included selling its international operations for more than $9 billion.
