GM will no longer prop up GMAC LLC

11/23/2007

General Motors Corp., whose shares are trading at a 17-month low, has "no further obligation" to inject capital into former finance unit GMAC LLC after a $1 billion infusion earlier this year.

The November 2006 agreement to sell 51 percent of GMAC to a group led by Cerberus Capital Management LP ended any need to fund GMAC beyond $1 billion, Randy Arickx, GM's executive director of investor relations, said this week. GM has lost a third of its market value since Nov. 1, when GMAC reported a $1.6 billion loss from subprime mortgages at its Residential Capital subsidiary.