NEW YORK (Reuters) – Ally Financial, the auto and mortgage lender majority-owned by the U.S. government, is delaying its initial public offering due to bad market conditions, two sources familiar with the situation told Reuters.
The IPO roadshow was expected to launch late this week or early next week, which would have brought the company public before the U.S. July 4 holiday.
The IPO, which will consist of both common and convertible shares, is expected to raise around $6 billion, one of the sources said. The IPO will move ahead when the market improves, that source said.
The other source said that the IPO could now come in late July or early August or after the September U.S. Labor Day holiday.
The sources declined to be named as the information is not public. Ally declined comment.
Bad mortgage loans forced the U.S. Treasury to pour $17.2 billion into Ally during the financial crisis. It has recovered some of that money through repayments and dividends and continues to hold a 73.8 percent stake in Ally, formerly known as GMAC.
Apart from the Treasury, Ally's stockholders include private equity firm Cerberus Capital Management, with a 9 percent stake, and General Motors Co (GM.N), which owns 4 percent directly and 6 percent through a trust.
Citi, Goldman Sachs, JPMorgan, Morgan Stanley, Barclays Capital and Deutsche Bank Securities are the underwriters on the IPO.
(Reporting by Clare Baldwin and Paritosh Bansal; editing by Carol Bishopric)
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