GM plans $5B stock buyback, avoids showdown with hedge funds
DETROIT (AP) — General Motors is agreeing to a $5 billion stock buyback, heading off a proxy fight with a group of hedge funds.
The buyback is part of a deal with former Obama administration autos task force member Harry Wilson, who agreed to drop his hostile candidacy for the GM board.
GM said Monday that the share repurchase will begin immediately and finish before the end of 2016.
The company still plans to keep $20 billion in cash on its balance sheet and maintain its investment-grade credit status.
GM also announced plans to return capital to shareholders that will be announced each January.
The company had $25.2 billion in cash at the end of last year. Wilson had sought an $8 billion buyback and a seat on the board.