CAN WE GET THEM TO BUY IT ALL?:

China to play role in General Motors IPO (AP, 11/14/10)

Chinese automaker SAIC, GM's partner in China, is finalizing plans to buy a roughly 1 percent stake, worth about $500 million, in GM's IPO, the Wall Street Journal reported Friday. SAIC is owned by the Shanghai city government. [...]

GM 's Nov. 18 stock offering will reduce the U.S. Treasury's stake in the company from 61 percent to 43 percent, and will help payback the more than $50 billion that taxpayers invested in GM to keep it from collapsing. More stock offerings will happen in the next year or so, letting the government fully divest from the automaker. [...]

Chris Theodore, president of consulting firm Theodore & Associates, says SAIC's investment in GM is likely an attempt to strengthen its ties with the automaker. Theodore, who was part of a group that tried to take over Volvo before it was sold to China's Geely group, says SAIC isn't the kind of company that can branch out into U.S. sales. Most of its models use GM technology and are essentially GM cars.

"They rely on GM for a lot of their profitability," Theodore says.

Michael Maduell, president of the Sovereign Wealth Fund Institute, a California-based group that watches sovereign wealth fund investments, says global investors are looking at the U.S. because they believe the overall market is undervalued. Other potential investors in GM include Abu Dhabi's Mubadala and Singapore's Temasek, which are both known for actively investing in companies, Maduell says.

Investors are "looking at emerging markets, like China and India, but all those assets are overvalued," Maduell says. "America still has a lot of fantastic investment opportunities in real estate and small- to mid-cap stocks."