DETROIT — Ally Financial Inc. announced this week that it repaid the U.S. Treasury $5.9 billion. To date, the finance source has returned more than 70 percent of the government’s $17.2 billion investment to save the former captive and to fuel its lending capabilities through the Great Recession.
The repayment was the result of Ally’s repurchase of outstanding shares of the Mandatorily Convertible Preferred securities held by the U.S. Department of the Treasury. Ally also completed a private placement of 216,667 shares of Ally common stock for an aggregate price of approximately $1.3 billion.
“Completion of these transactions marks key milestones for Ally,” said the company’s CEO, Michael A. Carpenter. “With the $5.9 billion payment, Ally has returned more than 70 percent of the investment to the U.S. taxpayer, as well as achieved a more normalized capital structure.
The U.S. Treasury currently holds approximately 64 percent of the common equity in Ally, down from 74 percent. The remaining 36 percent of the common equity is held by a diverse mix of existing and new institutional investors.