Michigan Democrats praise Obama administration for selling GM stock

The Department of U.S. Treasury and the Detroit-based announced the news earlier today. The $5.5 billion includes purchasing 200 million shares of GM common stock held by the U.S. Department of the Treasury for $5.5 billion.

DETROIT, MI- Well-known Michigan Democrats are praising the Obama administration's plan to fully exit General Motors Co. by March 2014.

The Department of U.S. Treasury and the Detroit-based announced the news earlier today. The $5.5 billion includes purchasing 200 million shares of GM common stock held by the U.S. Department of the Treasury for $5.5 billion.

After the repurchase, the U.S. Treasury will continue to own approximately 300 million shares of GM stock, or approximately 19 percent of the automaker, and start selling of its remaining shares as soon as January 2013.

The U.S. Treasury said the "manner, amount, and timing of the sales under the plan are dependent upon a number of factors."

The repurchase price of $27.50 per share represents a 7.9 percent, or about $2, premium over the stock's Tuesday closing price. The share buyback is expected to close by the end of the year, according to officials.

As a result of GM’s buy back, the government has recovered about $28.6 billion of its $49.5 billion GM bailout, which means it will most likely lose billions when selling its remaining shares. The government would need to sell its remaining shares at an average price of about $70 to break even. 

Here’s what politicians are saying about the announcement:

U.S. Sen. Carl Levin, D-Mich.

“Today’s announcement is an important step in GM’s recovery, and in the government’s necessary, but temporary, role in that recovery. This plan strikes the proper balance between maximizing return for the taxpayer and limiting government involvement in a private enterprise. Both GM and the Obama administration have been eager to bring the government’s role to a close in a responsible and orderly way, and this plan meets those goals.

“It’s important to keep in mind what the federal investment in GM and Chrysler sought to accomplish. It was about protecting more than 1 million workers whose jobs could have been lost, protecting families and communities that would have been devastated if the domestic auto industry had collapsed, preventing the massive cost the federal government would have had to bear in terms of unemployment insurance and other expenses, and avoiding the very real prospect of a second Great Depression. By any reasonable measure, this investment has been a tremendous success for GM and Chrysler and for America.”

U.S. Sen. Debbie Stabenow, D-Mich.

 “Today’s announcement is welcome news for General Motors and a testament to the resurgence of the American auto industry,” said Stabenow. “Some wrote off Michigan workers and auto companies and said we should let the American automobile and millions of jobs vanish. Instead, over a million jobs were saved, and more are being created as the American auto industry comes roaring back.”