Ally Financial has approval from the Federal Reserve to redeem 1,288,301 shares of its Fixed Rate Cumulative Perpetual Preferred Stock or Series G Preferred Shares at $1,000 per share plus all accrued and unpaid dividends for a total of $1,005.64 per share. The redemption date is 14 December 2015. This removes the restriction on Ally of offering common equity distributions. Ally’s stated objective is to pay a dividend and start a share repurchase program in 2016.
The U.S. Department of the Treasury sold its remaining 54.9 million shares of Ally common stock at $23.25 per share one year ago. As a result, Ally exited the Troubled Asset Relief Program (TARP). Treasury received $19.6 billion in total on the $17.2 billion Ally investment, which is $2.4 billion more than originally invested.
“The elimination of all remaining Series G Preferred Shares will decrease our preferred dividend burden and allow the company to optimize future capital management to drive shareholder value,” said Chief Executive Officer Jeffrey Brown.
The terms of the Series G Preferred Shares, which were developed during the financial crisis, prohibited the company from offering a dividend on common equity shares. In April 2015, Ally redeemed approximately $1.3 billion of its Series G Preferred Shares.
About Ken Zino
Ken Zino, editor and publisher of AutoInformed, is a versatile auto industry participant with global experience spanning decades in print and broadcast journalism, as well as social media. He has automobile testing, marketing, public relations and communications experience. He is past president of The International Motor Press Assn, the Detroit Press Club, founding member and first President of the Automotive Press Assn. He is a member of APA, IMPA and the Midwest Automotive Press Assn.
He also brings an historical perspective while citing their contemporary relevance of the work of legendary auto writers such as Ken Purdy, Jim Dunne or Jerry Flint, or writers such as Red Smith, Mark Twain, Thomas Jefferson – all to bring perspective to a chaotic automotive universe.
Above all, decades after he first drove a car, Zino still revels in the sound of the exhaust as the throttle is blipped during a downshift and the driver’s rush that occurs when the entry, apex and exit points of a turn are smoothly and swiftly crossed. It’s the beginning of a perfect lap.
AutoInformed has an editorial philosophy that loves transportation machines of all kinds while promoting critical thinking about the future use of cars and trucks.
Zino builds AutoInformed from his background in automotive journalism starting at Hearst Publishing in New York City on Motor and MotorTech Magazines and car testing where he reviewed hundreds of vehicles in his decade-long stint as the Detroit Bureau Chief of Road & Track magazine. Zino has also worked in Europe, and Asia – now the largest automotive market in the world with China at its center.
