GM Unit Pursued by Private Equity

Reuters reports at least three private equity firms are pursuing General Motors' Allison Transmissions unit, including Blackstone Group and Centerbridge Capital Partners, who have an active bid going for Chrysler and the Carlyle Group. GM CFO Fritz Henderson said Thursday "there are a number of parties that are interested and we're running a pretty disciplined process for looking at the business." According to unnamed sources, Allison's cash flow is more than $500 million and its price tag will be about $3 billion. Indiana-based Allison makes transmissions and hybrid propulsion systems for commercial trucks, buses and military vehicles.

Sources: Reuters, Financial Times Alphaville
Commentary: Subprime Fallout Hits General Motors • Hit By Subprime Woes, GM Misses On EPS By a Wide Margin • April U.S. Auto Sales Suffer Worst Decline Since 1998
Stocks/ETFs to watch: General Motors (GM). Competitors: DaimlerChrysler (DCX), Ford (F)
Conference call transcripts: General Motors Q1 2007 Earnings Call Transcript
Related: Allison Transmissions

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