GM's IPO Likely to Price at $33 a Share, Top of Range
Unless stock markets move sharply this afternoon, GM shares are likely to be priced at $33 apiece later Wednesday—the top of their announced range—as part of the company’s IPO, according to people with knowledge of the matter.
The expected $33-per-share pricing comes two days after investor enthusiasm prompted GM to raise the expected cost of its stock dramatically.
Late on Monday, the IPO’s underwriters revealed plans to price GM shares at between $32 and $33 apiece, rather than the originally planned range of between $26 and $29. A final decision on the pricing of the shares will come after U.S. markets close today.
Investor reactions to the price hike have been generally positive.
Citing the recent upturn in shares of Ford, which hit a eight-year high earlier this week, and the generally positive reception to GM’s investor road show, some market participants have said a higher price for the company’s shares was inevitable.
Still, some potential investors appear to be shying away from the deal.
Earlier Wednesday, sovereign-wealth funds in Asia and the Middle East that had been interested in GM stock allocations at a lower price canceled their orders, said a person familiar with the matter.
One exception: China Investment Corp., which still has a “modest” sized pending order, this person added.
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