General Motors Co (NYSE:GM) To Return To The S&P 500

General Motors Co (NYSE:GM) To Return To The S&P 500

Four years after General Motors Co (NYSE:GM) filed for bankruptcy, the company is set to return to the S&P 500. This shows the auto manufacturer is nearing recovery and government ownership is nearing its end.

The Detroit-based company was removed from the S&P 500 following its bankruptcy filing in June 2009. The S&P 500 is considered as the barometer in the US equities market. The stock price of a new company normally increases once it is included on the index due to the billions of dollars worth of investments.

Shares of GM reached its highest level in over two years recently after news about its return to the S&P 500 emerged.

GM CEO and Chairman Dan Akerson said the company has been working to bring back its clients around the world. It was also trying to increase the confidence of its investors. The return of General Motors Co (NYSE:GM) shows the progress in its efforts.

Companies with an IPO normally wait for at least six months before they are invited by the S&P to return to the index. The IPO of GM was launched in November 2010. Following its bankruptcy filing, 61 percent of the company was acquired by the government. This was part of the bailout the government provided the company.

For the moment, the share of the Treasury Department is down to 16 percent. By March 2014, the government will make a complete exit from General Motors Co (NYSE:GM).

General Motors Co (NYSE:GM) recently went down on the Fortune 500 list of the biggest companies in the US. This in contrast to its 1997 revenue ranking when it was bigger compared to that of Boeing, Coca-Cola, Dow Chemical, Intel and Microsoft combined.

For the moment, the company has yet to make its return to the Dow Jones Industrial Index. General Motors Co (NYSE:GM) was removed from the Dow Jones after it filed for bankruptcy in 2009.

Posted by James Fried on Wednesday June 05 2013, 2:32 AM EST. Ref: Detroit News. Link. All trademarks acknowledged. Filed under Finance. Comments and Trackbacks closed. Follow responses: RSS 2.0