As of Friday, General Motors Co’s initial public offering has been oversubscribed six times, which might lead to company shares selling close to the top end range of estimated pricing, according to market experts.
Current investor interest in GM shares is close to 60 billion dollars and continues to rise. The company planned to sell 10 billion dollars worth of common shares. Furthermore, there appears to be excessive demand for preferred shares, of which GM plans to sell about 3 billion dollars worth.
Considering the high demand on both types of shares, the price per share might be as high as 26-29 dollars. The value of the IPO might increase to more than 15 billion dollars, which might make this IPO the second highest, after that of Visa Inc.
The group is still accepting share orders from investors, but books are expected to close at the beginning of next week.
According to market sources, the company is holding negotiations with the Chinese SAIC Motor Corps about sales of shares and a deal of less than 2 billion dollars is expected before the weekend ends. Wealth funds from Asia and Middle East are also rumored to have a total commitment of approximately 2 billion dollars, while retails investors might account for approximately 20 percent of the transactions for values of 2-3 billion dollars as well.
