GM to divest 7% stake in PSA Peugeot Citroën, sells equity in Ally Financial

In terms of being a major newsmaker, the last seven days have probably been the biggest for General Motorssince its 2009 bankruptcy. Aside from announcing that Mary Barra will be succeeding Dan Akerson as its CEO next year, the automaker also appears to be streamlining its global operations by pulling Chevrolet from Europe in 2016 and winding its Holden manufacturing operations in Australia by the end of 2017. Now, as was originally speculated about in October, GM has confirmed that it is selling off its seven-percent stake in PSA Peugeot Citroën.

Despite this announcement, the two automakers will continue to move forward on elements of the alliance launched just 22 months ago, including shared vehicle platforms. According to PSA, these vehicles include a new subcompact MPV and a compact crossover both riding on existing PSA platforms, as well as an all-new subcompact commercial vehicle. Plans for a shared B-segment platform and a new small-displacement gasoline engine have been scrapped, however. In addition to these plans, GM and PSA are still hoping to benefit from synergies like joint purchasing and shared production, but the expected savings from these synergies has been reduced from $2 billion by 2017 to $1.2 billion by 2018.

GM is not discussing how much it expects to get from the sale of its 28.84 million shares of PSA, but The Detroit News indicates that the GM spent $400 million on the alliance 22 months ago.

In other sell-off news, GM has confirmed it has just parted with its its 8.5-percent common equity stake in Ally Financial. The sale, which included proceeds of about $0.9 billion, is expected to net GM about $0.5 billion which will be logged on its fourth-quarter balance sheet as a special item. The stock sale does not mean that Ally and GM are no longer on speaking terms, however, with CFO Dan Ammann saying, "Ally continues to play an important role in financing our dealers and customers in the United States."

Source:Autoblog