Tuesday, November 18, 2008
Hard-up GM to sell Suzuki stake
General Motors is selling its 3% stake in the Japanese carmaker Suzuki for $230m (£156m) to raise cash.
Suzuki said it would buy back the stake, adding that it understood GM faced a need to secure funding.
GM has reported a net loss of $2.5bn in the third quarter and has been trying to secure an emergency government loan along with its Detroit competitors.
The "Big Three" US car firms Chrysler, Ford and GM are seeking a total $25bn in federal aid.
Suzuki, which specialises in small cars, said the two companies would continue to cooperate in a number of joint projects, including developing new technologies. Their partnership started in 1981.
"We understand full well that GM faces a need to sell its shareholdings to secure funding," Suzuki said.
The US carmaker had already sold a 17% stake in Suzuki, in 2006.
US car firms companies have been hit by falling US sales and growing losses.
GM has said it would cut jobs and costs and has also suspended merger talks with Chrysler to focus on current issues.
DATED: 18.11.08
FEED: AW
