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Investment Group Buys 51% Stake in GMAC for $14B

DETROIT-GM executives are selling a 51% controlling interest in General Motors Acceptance Corp. to a group of investors led by New York City-based Cerberus Capital Management, LP. Following the deal, GM will retain about $20 billion of GMAC automotive lease and retail assets and associated funding valued at $4 billion.

By Dana Dubriwny | Updated on April 03, 2006

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DETROIT-Calling the deal “just what the doctor ordered,” GM executives this morning announced they have agreed to sell a 51% controlling interest in General Motors Acceptance Corp. (GMAC) to a group of investors. GM officials are expecting to receive approximately $14 billion in cash throughout three years, including distributions from GMAC, with an estimated $10 billion by closing.

In a special meeting Sunday, the GM board of directors approved the sale to the investment group, which is led by New York City-based Cerberus Capital Management, LP, a private investment firm, and includes Citigroup Inc. and Aozora Bank Ltd. Speaking for the GM board, presiding director George Fisher says that despite much work that still needs to be completed, “the GM board has great confidence in Rick Wagoner, his management team and the plan they are implementing to restore the company to profitability.”

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