GM prices $2 billion in senior unsecured notes

DETROIT - General Motors Co. (NYSE: GM), the global automaker with a market capitalization of $43.67 billion and annual revenue of $188.45 billion, has priced a series of senior unsecured fixed-rate notes totaling $2 billion, as part of its financial strategy, the company announced Monday. According to InvestingPro data, GM currently trades at $45.38 and analysis suggests the stock is fairly valued based on its Fair Value model. The notes are divided into three series: $750 million at 5.350% due in 2028, another $750 million at 5.625% due in 2030, and $500 million at 6.250% due in 2035. The settlement for this offering is expected to occur on May 7, 2025.

The automaker, which generated $18.46 billion in EBITDA over the last twelve months, has outlined that the net proceeds will be used for general corporate purposes. This includes refinancing part of its $1.25 billion outstanding 6.125% senior notes maturing on October 1, 2025. Additionally, the funds will contribute to a $1.8 billion five-year term loan to Ultium Cells LLC, a joint venture with LG Energy Solution. With a strong free cash flow yield of 30%, GM demonstrates robust financial flexibility for such strategic investments. This loan is aimed at fully prepaying the loans Ultium Cells received under the U.S. Department of Energy’s Advanced Technology Vehicles Manufacturing program.

Investors are directed to the prospectus and preliminary prospectus supplement filed with the Securities and Exchange Commission (SEC) for more detailed information about GM and this offering. These documents are available on the SEC’s EDGAR service online.

Citigroup Global Markets Inc., Goldman Sachs & Co. LLC, and Wells Fargo Securities, LLC are serving as joint book-running managers for the offering. Potential investors can obtain copies of the prospectus supplement and the accompanying prospectus by contacting these financial institutions directly.

The press release made it clear that this announcement does not constitute an offer to sell or a solicitation of an offer to buy the securities. Furthermore, there will be no sale of these securities in any state or jurisdiction where such an offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.

General Motors, a leading global automaker, is focused on leveraging advanced technology to produce safer, smarter, and lower-emission vehicles. Trading at an attractive P/E ratio of 6.43 and having increased its dividend by 25% over the last twelve months, the company’s portfolio includes a broad range of gasoline-powered vehicles and a significant lineup of electric vehicles (EVs) as it transitions to an all-electric future. For deeper insights into GM’s financial health and growth prospects, including 8 additional exclusive ProTips, visit InvestingPro to access the comprehensive Pro Research Report, part of the platform’s coverage of over 1,400 US stocks.

This article is based on a press release statement from General Motors.

In other recent news, General Motors has announced significant leadership changes and strategic financial moves. Duncan Aldred has been promoted to President of GM’s North America operations, a decision effective immediately. Aldred, who has been with GM for 33 years, will report directly to Rory Harvey, the Executive Vice President and President of Global Markets. This leadership change comes as GM faces challenges due to U.S. tariffs, which have led the company to lower its 2025 profit forecast.

In another development, GM has launched a new offering of senior unsecured fixed-rate notes to refinance part of its existing debt and support its joint venture with LG Energy Solution. The proceeds will aid in refinancing $1.25 billion of senior notes due in 2025 and fund a $1.8 billion loan to Ultium Cells LLC. UBS analyst Joseph Spak recently adjusted GM’s stock target to $50, down from $51, maintaining a neutral stance. Spak notes that GM’s realistic target setting suggests potential for an earnings per share beat, contingent on stable market conditions.

Additionally, GM has reduced shifts at its Oshawa Assembly plant in Canada from three to two, citing decreased demand and trade challenges. This decision impacts approximately 700 employees, with GM planning to adjust the plant for Canadian sales. The company also intends to increase production at its Fort Wayne, Indiana, plant, reflecting strategic operational adjustments amid current market conditions.

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