October 23, 2009

GM DAT Raises US$412 Million in Equity Rights Issue Through an Investment by its Majority Shareholder, General Motors

Press Release

Seoul — October 23, GM Daewoo Auto & Technology Co. (“GM DAT”) announced today that it raised KRW 491.2 billion (US$412 million) in an equity rights issue through an investment by its majority shareholder, General Motors Company (“GM”). GM DAT will use the proceeds, which will be received by October 28, for general corporate purposes, including funding the repayment of maturing debt.

Other shareholders in GM DAT — the Korea Development Bank (“KDB”), Suzuki Motor Corp. (“Suzuki”) and Shanghai Automotive Industry Corp. Group (“SAIC”) — chose not to subscribe to the equity rights issue. In the absence of other shareholders exercising their rights, GM decided to subscribe for the entire issue.

“The successful completion of the equity rights issue significantly strengthens GM DAT's liquidity and balance sheet position as we look to resume our strong growth,” said Mike Arcamone, President and CEO of GM DAT. “We are grateful for the support and confidence of our major shareholder.”

“GM's decision to increase its equity in GM DAT signifies the importance of our Korean business unit to GM's global operations,” said Nick Reilly, GM Executive Vice President and President of GM International Operations. “GM DAT will continue to play a significant role in the success of the new GM's global business.”

“With today's news, GM has underlined its commitment to GM DAT and to Chevrolet in Europe and around the world,” said Wayne Brannon, President and Managing Director, Chevrolet Europe. “Over the past seven years, GM DAT has become an integral part of General Motors' global engineering, design and manufacturing network. The vast majority of the cars built at our plants in Korea are Chevrolets for customers in over a hundred markets around the world. Great new cars like the Cruze and the Spark are evidence of how well our global teams are working together to build a strong future for Chevrolet. We are very pleased with today's news and look forward to continuing to work closely with our colleagues at GM DAT.”

On August 28, 2009, the GM DAT Board of Directors approved the issuance of 162,689,343 new shares in GM DAT at a price of KRW 3,019 per share to improve the company's liquidity position and bolster its balance sheet.

“Any further actions related to the longer-term funding structure of GM DAT will be considered if necessary,” said Reilly.

With this subscription, outstanding shares and equity stakes are as follows:

Common Shares: 415,481,799

GM:
KDB:
Suzuki:
SAIC:
70.1%
17.0%
6.8%
6.0%
Be Sociable, Share!

Tags: , , , ,

Comments are closed.