SAIC Exclusive response: GM 33 dollars into the share price did not exceed the budget

On November 18, General Motors returned to the New York Stock Exchange and listed on the Toronto Stock Exchange of Canada.　　GM's IPO amounted to $20.1 billion trillion, the largest U.S. IPO record ever.　　The same day, the Shanghai Automotive Group Co., Ltd. announced that its wholly-owned subsidiary of Shanghai Automotive Hong Kong Investment Co., Ltd. to a total of nearly 500 million U.S. dollars, the acquisition of 0.97 of the United States General Motors.　　On the afternoon of November 19, Shanghai Automobile was interviewed by our correspondent and responded to the details of purchase price and asset evaluation. The market forecast was that SAIC would buy 5% per cent of GM. "Eventually SAIC, though less than 1% per share, has shown that it has a common position and is setting the stage for further expansion of GM's global strategic partnership," he said.　　"There are market participants who have judged that SAIC has taken a cautious approach and more in expressing its support as GM's closest partner in China." GM's final price is $33 trillion, which was previously estimated at $26-29 trillion. On the increase in the IPO price, peak, chief financial officer of Shanghai, who took part in the acquisition, told reporters: "Prices are not higher than SAIC's budget in SAIC's forecast." "The price is 25% lower than the cost," 33 dollars for the U.S. government is actually a loss of business. "There are insiders to the reporter analysis." After the Obama administration took over, GM (GM) in the United States is called "Government car" (government motor), the government-backed enterprises, government and business are very taboo.　　So both the government and the business want GM to get rid of the government's background as soon as possible. According to the Obama administration's plan, the first step is to ensure a successful listing. Step two: After the 180-day lock is released regularly, the remaining stock will be sold two times. The Obama administration has stated that the government's holdings of GM shares will all be withdrawn within 18 months.　　It will launch two development releases 6 months later, with the U.S. government completely withdrawn after two to three or even four. But the reality is, the manufacturing industry in the United States is already "sunset industry." Whether GM can make a successful IPO, neither the US government nor GM is sure.　　"To make an IPO successful, it is crucial to set a reasonable price," said Wangliucheng, an analyst at China Merchants Securities.　　To save the bankruptcy of GM, the U.S. government has invested a total of 50 billion U.S. dollars, of which 43 billion U.S. dollars are government shares, the U.S. federal government has a total of 61% shares, and 7 billion U.S. dollars in bank loans. With a 61% stake of $43 billion trillion, GM's market capitalisation is only more than $70.9 billion trillion, and the U.S. government can recover 43 billion dollars.　　A total of 1.5 billion shares were issued by the General IPO, which was valued at $49.5 billion trillion at $33 trillion, meaning the offer was 25% lower than the U.S. government's cost. But the Obama administration is prepared for a losing IPO. Earlier, the US Treasury specifically said the US government was prepared to ask Congress to approve a total of 70A 0-dollar financial rescue plan, partly invested in financial institutions and partly in manufacturing. The general idea in the US Treasury is that part of the investment in the financial sector needs to be profitable, and that part of the investment in manufacturing may be in deficit.　　As a whole, the U.S. government's profit and loss is balanced. After the IPO, the US government's general equity stake has fallen from 61% to 33%, although the IPO price is set at a lower price, but there is room for added value in the future.　　The Obama administration wants to step down after the price rises. According to the "Green shoe mechanism" in the United States, if the issued shares do not fall below the IPO price within one months, the underwriters will fully exercise their green shoe options, that is, oversubscribed rights, and then subscribe to 54.8 million shares.　　That is why the US government is unwilling to start pricing too high. SAIC Bottom Line "market value not exceeding 70 billion" in the process of making a stake decision, we value the current strategic partnership with GM, we would like to see a stable, healthy and powerful General Motors, for which we are willing to support the successful completion of the IPO.　　"Peak said. "The share price is entirely in the Shanghai Auto Plan. Peak explained that SAIC had a basic judgment at the time: if the market capitalisation exceeded $70 billion trillion, it would mean the price would be as high as $44, according to equity estimates after issuance. "Because 70 billion dollars is basically the cost of the U.S. government, if the price is lower than this, then the future general stock prices will not be too much space, the risk can be controlled within the affordable range." "GM has been able to regain its competitiveness since its reorganization in July 2009 and has been profitable for three consecutive quarters this year," he said.　　In addition, the US auto market has steadily rebounded, and the booming demand for cars in emerging markets is also providing GM with further development opportunities.　　So why is SAIC's share less than 1%? Money is clearly not an issue that affects SAIC's share of shares. Only 1-September this year, Shanghai's car operating cash flow net worth of 11.97 billion yuan, the hands of cash and cash equivalents to reach 37.9 billion yuan.　　In addition, in order to fully prepare for cash flow, Shanghai Automobile has announced a 10 billion yuan directional additional. According to the relevant laws of the United States: ownership of more than 5% of the company will be important shareholders, shareholders need to disclose the relevant circumstances, the process is more complex. This is what SAIC is unwilling to accept.　　Moreover, if the stakes exceed a certain percentage, SAIC may consider sending directors to GM, a fear the US government is unwilling to accept. "If you buy GM 5% or more, there is no capital pressure on SAIC, but it is too big, and once there is a lot of volatility in GM's stock, our balance sheet can be a big fluctuation." We think the current amount is more appropriate. "As finance director Peak, the idea is simple--there is no price limit in foreign markets, SAIC hopes to support GM to go public, but does not want to have a greater impact on its own financial situation from GM to start the roadshow, SAIC will consider equity." But as a-like investors, SAIC does not know how much of a stake will eventually be allocated and needs to be involved in bidding. To be more flexible in bidding, SAIC opted to operate the capital market in Hong Kong, which is fully integrated into the world.　　And Hong Kong is an international financial market, facilitating the financing of the world.　　SAIC has prepared 800 million of billions of dollars to buy GM's shares, as SAIC has only been involved as a general investor and has won 15,151,515 shares in the last 33 dollars. Common-Eye "We are delighted that SAIC has decided to take part in the public offering of General Motors. For more than 14 years, GM and SAIC have maintained a very good partnership. "After SAIC's share of GM was completed, Li Tian, president of GM international operations, said at the first time:" The SAIC decision marks a new milestone in our partnership. "SAIC, the world's biggest and most important partner, has been keen on when GM will return to the NYSE since the bankruptcy of GM in June 2009," said the carmaker.　　GM has also been keeping close contact with SAIC to inform the company's movements in time. GM has communicated with SAIC about whether to sell Saab or sell its assets such as Hummer and Opel, according to people familiar with SAIC. "In the eyes of bankruptcy GM, SAIC is not simple as a business partner, more a strategic partner and a think-tank from China, the world's largest market."　　"Zhong Shi, a senior automotive analyst, said. SAIC has also been focusing on GM's restructuring process.　　In August this year, GM made its decision to make its IPO by the end of this year, and told SAIC the first time that it hoped to get help and support from Chinese partners. GM's board has raised hopes that SAIC will continue to support GM in its general IPO as usual.　　The "China concept" is a rare brand of GM's IPO.　　To keep the investment safe, SAIC set up a project team in August this year after GM made its IPO decision, and hired professional research firms and professional financial advisers to conduct a rigorous analysis of the public offerings of the GM IPO. Peak told reporters: "It can be said that our decision is fully considered with the general strategic partnership, GM's development prospects and valuation conditions, such as the comprehensive factors after the decision." "Market participants analysis, SAIC's participation in the general IPO will be a long-term investment."　　SAIC and GM currently have 10 joint ventures, and in recent years, the two major automobile groups have been continuously expanding the scope of cooperation and strengthen the strategic level, including the joint march into the Indian market, the global share of intellectual property, in the new Energy Vehicle basic technology research and development to strengthen cooperation.　　In the aftermath of the financial crisis, GM's interaction with Chinese companies is growing closer. In November 2010, SAIC's wholly-owned subsidiary, Shanghai Automotive Hong Kong Investment Limited, bought 0.97% per cent of GM in total by nearly 500 million US dollars. November 2010, GM claimed to have successfully increased its 10% stake in SAIC-GM Wuling (SGMW) to 44%.　　The price is paid to Wuling group about 51 million dollars in cash, and for SAIC-GM Wuling to provide technical services. In July 2010, the Pacific Century announced the acquisition of the global steering and transmission business of Nexteer, a U.S. General Motors company. The amount involved amounted to 480 million dollars. Delivery is expected to be completed in November. Pacific century is by also Zhuang International and Tianbao Group set up a joint venture.　　Among them, also Zhuang International is the Beijing municipal government in the development zone set up a wholly-funded investment and financing platform. In February 2010, private-sector tengzhong and GM negotiated a halt to moves to push for $150 million worth of deals.　　In June 2009, General Motors announced plans to sell Hummer brands to Tengzhong.　　In December 2009, Shanghai Auto bought 1% per cent of GM's Shanghai General Motors Holdings in 84.5 million U.S. dollars.　　In December 2009, GM and SAIC signed a joint venture with 50 50 shares in Hong Kong to enter the Asia-Pacific market.　　In December 2009, Baic bought GM's Saab 9-3, 9-5 full vehicle platform and two series of turbo engines, gearbox technology ownership and some manufacturing tooling in 200 million dollars. In July 2009, Baic expressed its intention to acquire Opel for the second time and issued a takeover offer. In August 2009, GM issued a statement saying the board of directors had decided to keep its Opel car unit.