WASHINGTON — The U.S. Department of the Treasury announced Thursday that it expects to sell 410,000 shares of Ally Financial Inc. common stock in a private offering at $7,375 per share. The sale is part of the department’s continued effort to wind down the Troubled Asset Relief Program (TARP).
The Treasury expects taxpayers to recover proceeds of approximately $3 billion from the common stock offering. At the conclusion of this sale, taxpayers will hold roughly 571,971 shares, or 37%, of common stock in the company and will have recovered approximately $15.3 billion, or 89%, of the $17.2 billion investment provided to Ally during the financial crisis.
“This is a very positive outcome for Ally and for the U.S. taxpayer, and the strong investor interest is a testament to the significant transformation of the company,” said Ally CEO Michael A. Carpenter.
The Treasury will continue to work with the company to further wind down this investment through either a public offering, private sale of its common shares, or other alternatives. After the sale concludes, the Treasury will have recovered approximately $435.8 billion on all TARP investments —including the sale of Treasury’s shares in AIG — compared to $422.2 billion disbursed.
In a press release issued by Ally, the company noted several actions it took in its effort to exist TARP, including raising common equity; achieving a non-objection to its comprehensive capital analysis and review plan; gaining approval for its ResCap Chapter 11 plan; returned $5.9 billion to the U.S. Treasury; and was granted Financial Holding Company status.
“These actions, coupled with the strength of our ongoing business, position Ally to complete its plans to exit TARP and to continue to build upon our thriving franchises,” Carpenter concluded.