Ally IPO Investors Follow Loeb, GM in Auto-Finance Bet: Timeline

Ally Financial Inc. investors who bought $2.38 billion of stock in an initial public offering yesterday join hedge fund manager Dan Loeb and private equity executive Stephen Feinberg seeking to profit from auto lending.

Below is a timeline showing the Detroit-based company’s rise under former parent General Motors, its near collapse after a venture into residential mortgages and its recovery.

1919: General Motors Acceptance Corp. is formed to provide financing to auto buyers.

1939: Motors Insurance Corp. forms.

1985: Mortgage business forms.

1999: GMAC purchases Ditech, which helps the company become one of the top subprime lenders before the housing market slump.

April 3, 2006: Feinberg’s Cerberus Capital Management LP leads a group that agrees to pay $7.4 billion for a majority stake in GMAC as GM Chief Executive Officer Rick Wagoner raises cash to prop up the automakers.

June 4, 2006: GMAC says it arranged more than $60 billion in new and refinanced credit to quell concern about its financial health after mortgage losses.

July 24, 2006: GMAC agrees to provide $3 billion of credit to its banking unit, under an agreement with federal regulators. The order states that Feinberg can’t control more than 25 percent of the board and that the bank can’t put branches or automated teller machines on property tied to his entities.

Photographer: Simon Dawson/Bloomberg

Third Point LLC Chief Executive Officer Dan Loeb. Close

Third Point LLC Chief Executive Officer Dan Loeb.

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Photographer: Simon Dawson/Bloomberg

Third Point LLC Chief Executive Officer Dan Loeb.

Nov. 7, 2007: GM reports a record $39 billion quarterly loss after three money-losing years forced the company to write down the value of future tax benefits. GMAC’s Residential Capital unit posts a $2.3 billion loss as the mortgage market unravels.

March 18, 2008: Alvaro de Molina is named CEO, replacing Eric Feldstein.

Dec. 29, 2008: The U.S. Treasury agrees to take a $5 billion stake in GMAC and lend $1 billion to GM as part of an effort to prop up the auto industry.

May 21, 2009: GMAC gets $7.5 billion from the Treasury, including funds to expand auto lending at Chrysler.

Oct. 19, 2009: GMAC agrees to sell an insurance business to American Capital Acquisition Corp.

Nov. 16, 2009: Michael Carpenter is named CEO.

Dec. 30, 2009: The lender receives a third rescue package, valued at $3.8 billion and giving the U.S. a majority stake.

May 10, 2010: The company changes its name to Ally, the brand it already uses for a consumer banking operation.

July 22, 2010: GM agrees to pay about $3.5 billion for subprime lender AmeriCredit Corp. to bolster lending options for customers. The automaker had considered buying back GMAC, people familiar with the matter said.

Dec. 30, 2010: The government converts $5.5 billion of preferred stock into common shares, boosting its stake to 74 percent.

May 14, 2012: Ally’s ResCap files for bankruptcy.

Oct. 18, 2012: Ally agrees to sell its Mexican insurance business to Ace Ltd. for $865 million.

Feb. 6, 2013: Chrysler and U.S. unit of Banco Santander SA form Chrysler Capital, replacing Ally as the third-largest U.S. automaker’s preferred provider of auto loans.

Feb. 9, 2013: Carpenter says Ally will repay the U.S. by 2014 on the strength of its auto-finance business.

Aug. 20, 2013: Ally said it will raise $1 billion in a private placement and pay $5.9 billion in a plan to buy back preferred shares held by the Treasury department.

Jan. 21, 2014: Loeb’s Third Point LLC says it amassed a 9.5 percent stake in Ally through private transactions.

April 9, 2014: The U.S. Treasury sells 95 million shares for $25 apiece, cutting the U.S. stake to about 17 percent from about 37 percent, according to the prospectus.

To contact the reporters on this story: Dakin Campbell in New York at dcampbell27@bloomberg.net; Craig Trudell in Tokyo at ctrudell1@bloomberg.net

To contact the editors responsible for this story: Peter Eichenbaum at peichenbaum@bloomberg.net Dan Kraut, Dan Reichl

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