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GM Acquires Ally’s Overseas Lending Operations

Maker hopes to boost sales in Europe, Latin America and China.

by on Nov.23, 2012

Ally, the former GMAC, will shift its focus back to auto lending in the U.S. market.

Ally Financial Inc. – what used to be known as GMAC — plans sell its lending operations in Europe and Latin America, as well as its share in a joint venture in China, to General Motors Co. for $4.2 billion.

GM Financial, a wholly-owned GM subsidiary, will assume responsibility for the management of Ally’s international operations. The acquisition will also double the size of the GM Financial loan portfolio to more than $32 billion, General Motors’ Chief Financial Officer Dan Ammann said Wednesday.

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“We’re bringing those assets back into the family, which we think will help us increase our sales around the world. We have a lot of new product launches coming all around the world, across Asia and China, Ammann said during a conference call with reporters. “It will help drive top line growth,” he said, adding, “We couldn’t be more pleased.”


GM Takes Major Step to Sever Ties to Former GMAC

GM Sets $1 bil Price Tag on Ally Financial Shares

by on Mar.23, 2011

GM takes another step to sever ties with the former GMAC, now known as Ally Financial.

General Motors has announced it will use a new public offering to sell off $1 billion in preferred stock in Ally Financial Inc. — further distancing itself from its long-time in-house lending arm.

The shares represent 100% of the outstanding Series A preferred stock for Ally, which used to be known as GMAC, for decades the so-called “captive finance subsidiary” of the Detroit automaker. GM gave up control of GMAC in 2006 and has since taken steps to expand its sources of automotive lending.

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“Today, we are taking another step forward in our strategy to strengthen and simplify the company’s balance sheet,” said Chris Liddell, GM outgoing vice chairman and chief financial officer.

The transaction will result in a book gain of $300 million to be recorded in the first quarter of 2011. Following the sale, GM’s investment in Ally Financial will consist of a 9.9% interest in Ally common stock. GM reportedly passed on an opportunity to exchange the preferred shares for more equity in Ally Financial, which was originally known as General Motors Acceptance Corp.