In exchange for business, investment banks have been known to trade a Yankees ticket or two (Legends seats a few rows off the field, of course) or perhaps a box at the US Open.
General Motors, however, appears to be taking the gratuity idea to a whole new level in preparation for its initial public offering, according to a Bloomberg report today:
When GM sought proposals in May to manage its initial public offering, it didn’t want advice only on selling shares. The automaker wanted help selling Cadillacs and Corvettes. Banks were asked to consider using some of the underwriting fees to subsidize the purchase of GM cars by their employees, according to a two-page document obtained by Bloomberg.
Where I come from, that’s called chutzpah.
According to Bloomberg, JPMorgan Chase & Co. and Morgan Stanley won the lead mandate in June, agreeing to fees of 0.75% of the sale, a quarter of the usual rate for large stock sales.
GM’s IPO prospectus is expected next month.
