Automobile company General Motors Co. has cleared another obstacle over the weekend, as the company’s Chief Executive Mary Barra has successfully convinced a group of investors that its share buyback plan of worth USD 5 billion is in the best interest of the shareholders.
The company revealed his buyback plan on Monday following a rigorous month-long discussion with former hedge-fund manager Harry J. Wilson.
Wilson, who represents a hedge funds group owning nearly two percent of General Motors’ stock, including Appaloosa Management, has asked for a seat in the company’s board as well as a USD 8 billion buyback.
Barra has said that a share buyback plan came in process much before Wilson’s demands arose.
“We were on a path to do this anyway,” Barra told mediapersons on Monday.
She also asserted that the company is “pleased” that Wilson has dropped his demands. She also said that her management team will be working to be “responsible stewards of our owners’ capital”.
The investor group of Wilson came as the latest challenge for Barra’s leadership since she assumed her roles 14 months ago.
Meanwhile, the stocks of General Motors remained stuck in neutral. The shares closed at USD 36.84 on Friday, which is nearly USD 3 lower than the level when Barra took over as chief executive. The company’s shares made their debut at USD 33 during an initial public offering (IPO) in November 2010.