Saturday, December 19, 2009

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GM says it has repaid part of its bailout loans (CTV.ca)

Posted: 18 Dec 2009 07:31 PM PST

DETROIT — General Motors Co. made the first payment on its giant instalment loans from the U.S. and Canadian governments on Friday, sending US$1 billion to the U.S. Treasury and $192 million to Canada.

The company plans to repay the governments in full by the end of June, but chairman and acting CEO Ed Whitacre Jr. said in a statement that repayment is contingent on no downturns in the economy or GM's business.

GM owes the U.S. government a total of $52 billion, with $6.7 billion of that in loans. At least part of the remaining $45.3 billion could be repaid when GM sells stock, perhaps late next year.

The U.S. government currently owns about 61 per cent of the troubled Detroit automaker in exchange for putting up money that is keeping the company afloat.

GM also owes $1.4 billion in loans to the Canadian and Ontario governments.

Whitacre on Tuesday committed to repaying the loans by the end of June. His predecessor as CEO, Fritz Henderson, announced plans to start making quarterly payments when GM released its third-quarter earnings in November.


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