General Motors Co
Initial paperwork for the IPO is now expected to be filed with the U.S. Securities and Exchange Commission early next week, several sources familiar with the situation said.
The filing was originally expected on Friday but was delayed because the company had to update its prospectus with the recent CEO change and a management risk factor, another source familiar with the situation said on Friday.
Bank of America Merrill Lynch and Citi will join JPMorgan Chase & Co
JPMorgan and Morgan Stanley, picked as lead underwriters on the GM IPO earlier this year, helped the automaker prepare the paperwork for the IPO; Bank of America and Citi led the $5 billion credit facility that GM recently completed in preparation for its IPO, the sources said.
All the sources declined to be named because preparations for the IPO are not public.
Ten major banks have signed on to the credit facility, committing up to $500 million each, but the individual commitments would be cut as GM adds more banks in other countries and emerging markets as part of its efforts to attract global investors, several of the sources said.
Banks participating in the credit facility are Bank of America, Citi, Barclays Capital
Bank of America and Morgan Stanley declined to comment; GM, Barclays, Citi, Deutsche Bank, Goldman Sachs, and JPMorgan, Royal Bank of Canada, UBS and Credit Suisse were not immediately available for comment.
GM's initial prospectus to be filed next week will likely list about 10 banks as underwriters, with more banks added before the IPO prices, one of the sources said. The banks that will be listed as underwriters in the initial filing are likely to be the same banks that have committed to the credit facility, the source added.
GM's several-hundred-page prospectus will not provide the number of shares to be sold or the pricing range. It will cite the company's bankruptcy, steps completed in restructuring, financial projections, details of ownership, and a large set of risk factors, sources have said.
RISKY MANAGEMENT, RETAIL INVESTORS
GM is now adding a new risk factor regarding the departure of Whitacre and increased uncertainty about the automaker's long-term leadership, one of the sources said.
GM Chief Executive Ed Whitacre said on Thursday he would step down and Dan Akerson would take over, effective in September.
A successful GM IPO, which could be the largest ever for the U.S. market, would hand the Obama administration an important political win against critics of its controversial $50 billion bailout of the top U.S. automaker, analysts have said.
The U.S. Treasury has a 61 percent stake in GM as a result of the bailout.
As GM gets closer to selling shares to the public, it must decide what percent of the IPO to sell to institutional investors and what percent to sell to retail investors. It is currently considering selling 20 percent to 30 percent of the IPO to retail investors -- more than the 20 percent typically sold to retail, one of the sources said.
By filing initial paperwork with the SEC next week, GM is aiming to complete its IPO between late October and the U.S. Thanksgiving holiday, another source familiar with the matter said.
The automaker secured the $5 billion credit facility this week, two sources briefed on the deal told Reuters on Wednesday, clearing a key hurdle toward the initial public offering of stock expected to make the U.S. government a minority shareholder.
(Reporting by Soyoung Kim and Clare Baldwin; editing by Lisa Von Ahn, John Wallace editing by Andre Grenon)