Proceeds Now Exceed Total Disbursements
WASHINGTON – As part of its continued progress in
winding down the Troubled Asset Relief Program (TARP), the U.S. Department of
the Treasury today announced that it has agreed to sell 95,000,000 shares of
Ally Financial Inc. (Ally) common stock at a price to the public of $25.00 per
share, for $2.375 billion in proceeds to taxpayers from Ally’s initial public
offering (IPO). Prior to the IPO, taxpayers held approximately 37 percent
of common stock in the company, or 177,311,010 shares. After the closing
of the offering, taxpayers will hold approximately 17 percent of common stock,
or 82,311,010 shares, in the company. Treasury has granted the
underwriters a 30-day option to purchase an additional 14,250,000 of the Ally
common stock shares it holds at the initial public offering price.
“Taxpayers’ investment in Ally – together with
the broader auto rescue – helped protect the economy by avoiding a catastrophic
and disorderly collapse of the American auto industry,” said Treasury Under
Secretary Mary Miller. “With this offering, taxpayers have now recovered more
than they invested in Ally.”
TARP’s most important goal was to stabilize the
financial system and prevent a second great depression, not to make a profit.
Still, when including anticipated proceeds from Ally’s IPO, taxpayers will have
recovered approximately $17.7 billion, approximately $500 million more than was
originally invested in the company. Including the sale of Treasury’s AIG
shares, Treasury will have recovered a total of $438.3 billion on TARP
investments, compared to $423.4 billion disbursed. Treasury will continue
to evaluate exit strategies for its remaining Ally investment and wind down
TARP as soon as practicable, and in a way that maximizes taxpayer value.
For more details on Treasury’s lifetime cost
estimates for TARP programs, please visit Treasury’s Monthly 105(a) Report to
Congress on TARP at this link.
The initial public offering is expected to
close on April 15, 2014, subject to customary closing conditions.
Citigroup Global Markets Inc., Goldman, Sachs & Co., Morgan Stanley &
Co. LLC, and Barclays Capital Inc. served as the global coordinators and joint
book-running managers for this offering. Joint book-running managers also
include BofA Merrill Lynch, Deutsche Bank Securities and J.P. Morgan. Lazard
served as Treasury's financial advisor with respect to the management and
disposition of Treasury's investment in Ally.
The Ally common stock is being sold pursuant to
an effective registration statement previously filed by Ally with the
Securities and Exchange Commission (“SEC”). The preliminary prospectus relating
to these securities was filed by Ally with the SEC on March 27, 2014, and a final
prospectus will be filed by Ally with the SEC and will be available on the
SEC’s website at http://www.sec.gov.
Copies of the final prospectus, when available,
may be obtained from Citigroup Global Markets Inc., c/o Broadridge Financial
Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, or by calling (800)
831-9146; Goldman, Sachs & Co., Prospectus Department, 200 West Street, New
York, NY 10282, by calling (866) 471-2526, or by emailing email@example.com;
Morgan Stanley & Co. LLC, Attention: Prospectus Department, 180 Varick
Street, 2nd Floor, New York, NY 10014 by calling (866) 718-1649, or by emailing
and Barclays Capital Inc. c/o Broadridge Financial Solutions, 1155 Long Island
Avenue, Edgewood, NY 11717, by calling (888) 603-5847, or by emailing Barclaysprospectus@broadridge.com.
This press release does not constitute an offer
to sell or a solicitation of an offer to buy the common stock, nor shall there
be any offer, solicitation or sale of any common stock in any jurisdiction in
which such offer, solicitation or sale would be unlawful prior to registration
or qualification under the securities laws of any such state or jurisdiction.