GM Korea Says It Redeemed 700 Billion Won of Preferred SharesRose Kim
General Motors Co.’s South Korean unit said it redeemed about 700 billion won ($649 million) of preferred shares to avoid higher dividend payments.
GM Korea bought back the securities from creditors including Korea Development Bank late last year after the dividend payout escalated to 7 percent of the preferred stock’s $4,000 price from 2.5 percent, according to a company e-mail today. The increase in the dividend is part of a deal in 2002, when the GM unit agreed to redeem all the preferred shares from creditors by 2017.
The latest purchase indicates the company redeemed half of the 325,414 preferred shares it had outstanding at the end of 2011, though GM Korea declined to say how many preferred shares it bought back.
“The transaction was purely based on a decision to improve the financial status of the company,” the company said in an e-mailed response to a Bloomberg query. “GM Korea will continue to buy back preferred shares according to the contract.”
GM’s factories in South Korea produce Chevrolet vehicles for the domestic market and for export to markets including Europe and South America.
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.
- Comedian Byron Allen Buys the Weather Channel for $300 Million
- Stocks Tumble in Biggest Weekly Decline Since 2016: Markets Wrap
- Musk Takes Down the Tesla and SpaceX Facebook Pages
- A Horror Week for the Dow Has Investors Begging for Trump Respite
- World's Biggest Cryptocurrency Exchange Is Heading to Malta