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General Motors to Buy Back $3.2B of Preferred Stock

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Sept. 25, 2013—General Motors Co. announced Monday it has reached an agreement to repurchase 120 million shares of its Series A Preferred Stock from the UAW Retiree Medical Benefits Trust (UAW VEBA) for a total cash consideration of approximately $3.2 billion, or $27 per share.

The agreement is contingent upon the closing of an offering by GM of senior unsecured notes on or before Sept. 30.

GM also announced Monday that it has launched an offering of senior unsecured notes in five-, 10- and 30-year tenors. The net proceeds of the offering will be used for general corporate purposes including the repurchase of Series A Preferred Stock from UAW VEBA.

In association with the stock purchase, GM expects to record a charge of approximately $800 million in the third quarter, which will be treated as a special item.

The stocks will not be sold publically. Offers will be made only by means of a confidential offering memorandum.

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