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GM Profits Could Hit $13 Billion Annually, Company Claims

Maker using huge upside potential to sell upcoming IPO.

by on Nov.05, 2010

GM could post a profit of $13 billion, new CEO Akerson suggests.

General Motors could turn a profit of as much as $13 billion a year, the maker is touting, as it begins the nonetheless challenging task of selling investors on its upcoming IPO.

Though the maker has yet to set a final date for the initial public offering, it is expected to take itself public again on November 18th, and has confirmed that it will offer its new shares for somewhere between $26 and $29 apiece.  The sale is expected to reduce the U.S. government’s holdings in the company from 60.1% to around 40%, though it is being estimated that the Treasury could lose as much as $5.4 billion on the sale.

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But both the automaker and government officials are hoping to not just sell out the anticipated offering of 365 million shares but build buzz that could drive demand for future stock sales – at a higher price.

And, with GM officials setting out to meet with potential investors, they are prepared to make some sweeping, upbeat forecasts.

“I know a great investment opportunity and the new GM is just that,” GM CEO Daniel Akerson said in an online video presentation. “We can make significant profit even in today’s difficult environment.”