General Motors: Profitability, sales of shares possible in 2010

[Blue_Tires]

General Motors: Profitability, sales of shares possible in 2010
03/17/2010, 1:32 PMBy Mark Kleis
General Motor’s newly acquired CFO – Chris Liddell – announced that there is a possibility of GM both returning to profitability and selling some shares before the close of 2010. Liddell did clarify that GM will not rush an IPO, and they do not have an exact timetable.


Following a hasty correction by Reuters, GM’s CFO, Liddell, was misquoted as suggesting the possibility for an IPO in 2010. A revised report clarifies that Liddell suggested the automaker may begin to sell shares for the first time since entering bankruptcy and taking on significant government ownership, but the automaker has no timetable for an actual IPO.

“Even in the few months I’ve been here, I’ve been encouraged by the progress we’ve made, but when it will all come together is impossible to say,” explained Liddell to Retuers in response to questions about the timetable for an IPO.

Currently GM is the recipient of over $50 billion in government funding as part of their restructuring and bankruptcy process in conjunction with the U.S. Treasury, with the U.S. government owning 61 percent of the automaker. Liddell pointed out that the bankruptcy and government loans have allowed the automaker to make significant cost cuts and reduce debt since last year.

“The preconditions for success are extremely good – although maybe not so obvious to people when they look from the outside,” Liddell said. “I think we have a reasonable chance of being profitable this year. Relative to where we were a few years ago, that’s enormous progress.”

Liddell joined the ranks of GM as a former CFO for Microsoft, and as he put it, he felt he had reached a point of diminishing returns at Microsoft. Wanting to be able to contribute more, Liddell felt he could make a difference at GM.

“People say, ‘why would you leave this incredibly comfortable existence?’” said Liddell. “I like to joke that this was the hardest job, this was the least amount of pay, this was the toughest situation I was looking at. But other than that, it was an entirely rational decision.”

“If I can be part of a team that helps the turnaround at GM, that’s something I can be proud of in 10 or 20 years,” Liddell added.

Liddell has an annual salary of $750,000 in addition to $5.45 million in restricted stock and salary stock grants with GM.
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