GM to buy Ally Financial’s European, LatAm operations for $4.2 bn
22 Nov 2012
General Motors' (GM) financing arm GM Financial yesterday said it would buy the European and Latin American auto lending operations of Ally Financial, for around $4.2 billion.
The deal includes Ally's operations in Brazil, Mexico, Colombia, Chile,Germany, Britain, France, Italy, Belgium, the Netherlands, Sweden, Switzerland and Austria. It also includes Ally's 40 per cent interest in its Chinese joint venture GMAC-SAIC Automotive Finance Company.
"We're bringing those parts of Ally back into the family," said Dan Ammann, GM's chief financial officer, on a conference call with reporters.
Ammann said the deal had been approved by the GM board of directors, and would not require approval from the US government.
Ally, earlier known as GMAC, Ally and the former auto financing arm of GM, which is 73.8 per cent owned by the US government, had in May said that it plans to sell its international operations in order to repay bailout funds.
The US government had bailed out the company through a $17 billion loan as part of its bailout of the US auto industry during the 2009 global financial crisis. GM continues to hold 9.9 per cent in Ally, while remaining is held by Cerberus Capital and other investors.
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