GM Poised For $1 Billion Payday As Stellantis Buys Back Shares

Sep. 16, 2022 5:47 PM ET by Jarryd Neves Industry News / 6 Comments

The deal relates to the PSA Group's acquisition of Opel/Vauxhall in 2017.

Stellantis and General Motors have agreed to execute a share repurchase that will see the multinational corporation buy 69.1 million of its shares back from the American automaker. Stellantis says this represents around 2.2% of the company's share capital (on a diluted basis).

GM is expected to receive €923,247,678 (approx. $922,453,700) in return for the shares. The agreement relates to a 2017 deal when the PSA Group elected to purchase Opel and Vauxhall from General Motors. As part of the deal, the now-defunct French automotive company issued equity warrants to GM.

Aside from the near-$1 billion payment, Stellantis will also provide General Motors with 1.2 million shares in Faurecia - an automotive parts supplier - and "an aggregate cash amount of approximately €130 million (approx. $129,825,800) for rights to dividends paid by PSA and Stellantis." The deal is scheduled to take place on September 15.

Both Opel and Vauxhall were acquired by GM as far back as the 1920s and remained under its control until 2017. During that period, neither of the brand's vehicles came to America officially, but GM rebadged several models and sold them through its US marques. Examples include the Cadillac Catera (based on the Opel/Vauxhall Omega) and, more recently, the Buick Regal (based on the now-dead Opel/Vauxhall Insignia).

As far as we know, Stellantis has no plans to introduce any Opel/Vauxhall models in America, even rebadged ones. It's entirely possible, as Dodge recently reskinned the Alfa Romeo Tonale and introduced a new crossover, called the Hornet. In just over 24 hours, the American automaker received 14,000 pre-orders for its new compact car.

With the right image and marketing, Stellantis could breathe new life into the Chrysler range, which currently comprises just two vehicles - the Pacifica and the woefully outdated 300 sedan. The latter is nearing the end of its long life and is saying goodbye with a V8-powered special edition.

Like the rest of the brands under the Stellantis umbrella, Opel and Vauxhall are out for blood in the electric vehicle segment. In the United Kingdom, Vauxhall's entire line-up has a fully electric (or electrified option) and the brand is aiming to emancipate itself from the grips of gasoline by 2028 - all of its vehicles will be battery-powered by then.

Over in the United States, a similar movement is happening. The Charger, Challenger, and aforementioned 300 - all bastions of American car culture - are enjoying one last hurrah before they're replaced with electric successors. It would make a lot of sense for Stellantis to capitalize on this move and, for example, offer the Astra Estate (pictured above) as a funky, more compact stablemate.

GM Poised For $1 Billion Payday As Stellantis Buys Back Shares

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GM Poised For $1 Billion Payday As Stellantis Buys Back Shares

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