One of the things that makes buying a new car challenging, say like the upcoming 2011 Chevrolet Cruze, is the ability to obtain financing. GM is seeking to make this a little easier for their prospective buyers by acquiring AmeriCredit. The acquisition of the company is said to fill a gap that was left when GM gave up control of GMAC in 2006.
For those who aren’t familiar AmeriCredit acquired Long Beach Acceptance Corporation back in 2007 for 282.5 million dollars cash. The acquisition was in order to leverage the near-prime lending mix that Long Beach Acceptance participated in. Now the tables have turned and GM has acquired AmeriCredit for the same reason. "Adding AmeriCredit to our team will improve our competitiveness in auto financing offerings, and I am very pleased to have them on board," said Ed Whitacre, GM's chief executive.
According to the L.A. Times, GM said it would purchase AmeriCredit Corporation in an all-cash transaction valued at approximately $3.5 billion. What you say, you want to know that number in shares? That would be about $24.50 a share. GM isn’t going into this acquisition blindly, they have already been working with AmeriCredit to provide loans to customers with “non-prime” or low credit ratings.
Bottom line—GM is making moves to make sure they can sell customers the cars they want.
[Source: L.A. Times]