RPT-UPDATE 2-GM on track for mid-November IPO-sources

(repeats story first filed late on Thursday)

* GM IPO on track for mid-Nov debut-sources

* Fund, valuation meetings show deal’s quickening pace

* GM to pitch turnaround progress in roadshow-sources
(Adds background on meetings, details of GM pitch, background
on Tower IPO, paragraph 16 to end)

By Soyoung Kim and Clare Baldwin

NEW YORK, Oct 14 (BestGrowthStock) – General Motors Co [GM.UL] is
on track to move ahead with its initial public offering during
the week of Nov. 15 after a recent round of meetings with
sovereign wealth funds, sources with knowledge of preparation
for the deal said.

The GM IPO has been closely watched both because of its
expected scale and because of the involvement of the U.S.
government, which is looking to the landmark stock offering to
reduce its nearly 61 percent stake in the automaker.

Bankers representing GM met with sovereign wealth funds in
Asia and the Middle East over the past two weeks to make the
case that the automaker has emerged from its 2009 bankruptcy as
a leaner and more nimble competitor, two of the sources said.

Singapore-based GIC and Temasek Holdings, Kuwait Investment
Authority, Qatar Investment Authority and the Abu Dhabi
Investment Authority were all approached as part of those
meetings, one of the sources said.

At the same time, analysts from the 10 underwriter banks
involved in the GM IPO began a series of meetings last week
aimed at reaching a consensus on the market value the top U.S.
automaker, two of the sources said.

After analysts come to consensus on that valuation, GM will
offer investors a discount of 20 percent from that level in
pricing shares for the IPO, three sources said.

That margin of discount is part of a standard practice in
IPOs to reward investors for taking a risk on a new issue.

GM needs to have a market valuation of about $67 billion if
U.S. taxpayers are to break even on the common stock the U.S.
Treasury holds.

The U.S. Treasury is expected to be the major seller of
common stock in the GM IPO and is prepared to take a loss on
the initial sale of stock, sources have said.

The governments of Canada and Ontario will likely follow
the lead of the U.S. government as sellers, two sources said.
As part of the GM bailout, Canada offered the automaker funding
and took a stake of 11.7 percent in return.

It remains unclear if a trust fund affiliated with the
United Auto Workers union will sell part of its stake in the
IPO. The union trust, which was established to pay for retiree
healthcare costs, holds 17.5 percent of GM.

The UAW trust fund — known as the union’s VEBA — has been
weighing whether it would be better served by waiting to sell
stock in GM at subsequent offerings that could come at a higher
price, one person with knowledge of the deliberations said.

The GM IPO is expected to price on Nov. 17 with the debut
on Nov. 18, three of the sources said.

People involved in the deal have said shares would likely
price between $20 and $25 after a stock split by the automaker.
On Wednesday, GM Chairman Ed Whitacre also said he thought that
was a likely range for the IPO price.

“I can’t say how much we’ll sell, but I can say we’ll have
a successful IPO sometime in November,” Whitacre said. “It’s
going to work, and it was absolutely the right thing to save
this company.”


GM executives, bankers in its underwriting syndicate and
advisers have all declined to discuss the IPO in public because
of the restrictions imposed by U.S. securities laws.

But there have been signs this week that the pace of
preparations for the deal are quickening.

U.S. Treasury Secretary Timothy Geithner and Ron Bloom, the
official overseeing the U.S. investment in the auto industry,
met GM Chief Executive Dan Akerson on Tuesday in New York to
get an update on the automaker’s business and IPO plans.

Also this week, GM told over 600,000 employees, retirees
and dealers in letters sent from its Detroit headquarters that
they had until Oct. 22 to register to buy stock in the IPO.

At meetings with investors, bankers have emphasized GM’s
strong position in China, the slowing pace of losses at its
Opel unit in Europe and its lowered break-even point in the
U.S. market, two sources said.

GM Chief Financial Officer Chris Liddell, expected to be
central to the upcoming roadshow for investors, said in May
that the automaker was set up to break even with industry-wide
U.S. sales of about 11 million vehicles annually.

But cost-cutting progress by GM has reduced that threshold
even further, a positive point the automaker will tout to
investors, one source said.

GM plans to file a final IPO prospectus on Nov. 1 or Nov.
2, just before it begins courting investors in its roadshow,
two sources said. That prospectus will include the number of
shares to be sold, the pricing range and the selling
shareholders among other details.

No dollar amount has been set for the IPO and that will not
be determined until GM files the final prospectus in early
November, the sources said.

The GM IPO has long been seen as raising between $10
billion and $20 billion, making it one of the largest U.S.
stock offerings ever. But with the slow pace of recovery in
auto sales and the U.S. economy, the size of the IPO could come
at the low end of the expectations, several sources have said.

In one indication of the headwinds the GM deal could face,
auto parts supplier Tower International Inc (TOWR.N: ) priced
shares in its IPO 19 percent below the midpoint of the expected
range on Thursday. [ID:nN14159669]

The GM IPO underwriting syndicate is led by Morgan Stanley,
JPMorgan, Bank of America Merrill Lynch and Citi.
(Reporting by Soyoung Kim and Clare Baldwin in New York;
Additional reporting by Kevin Krolicki and David Bailey in
Detroit and Philipp Halstrick in Frankfurt; Editing by Gary

RPT-UPDATE 2-GM on track for mid-November IPO-sources