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Business Title: Treasury Selects Lazard Freres As Its Advisor To Prepare Stock Offering For General Motors WASHINGTON — The Treasury Department has hired Lazard Freres & Co. as its adviser to prepare for an initial public stock offering by General Motors Co. Treasury signed the agreement on Monday but did not reveal it until Friday. The agreement says that Lazard Freres will be paid $500,000 a month over the next year for the advice it provides the government. The agreement says that if no stock sale has occurred during the first 12 months of the contract, Lazard Freres will receive a fee of $250,000 a month until the sale is completed. The Treasury owns 61 percent of General Motors. The IPO would allow the government to begin recouping its investment. GM CEO Ed Whitacre has said he expects an IPO in late 2010 or early 2011. To keep GM afloat and to get it through bankruptcy court, the U.S. government gave the company $50 billion. GM repaid $6.7 billion that the government considered loans. The remaining $43.3 billion was converted to the 61 percent stake. On Monday, General Motors announced that it had posted a quarterly profit less than a year after it emerged from bankruptcy. Its net income rose to $865 million, a dramatic reversal from the $6 billion it lost in the same period last year. The automaker said that its revenue was up by 40 percent over the first quarter of last year and that U.S. sales had risen by 17 percent, allowing GM to make an operating profit in North America. After the quarterly earnings were announced Monday, Chris Liddell, GM’s chief financial officer, who was hired recently from Microsoft Corp., said an IPO could occur over the next 12 months if things fell into place. “Certainly over the next year, there’s a possibility we could do an IPO, but the market’s got to be ready, the automobile industry has to continue to improve and we have to continue to improve,” Liddell said. To pay off its shareholders, including the government, a United Auto Wokers union health care trust and its old bondholders, the stock market would have to value GM at more than $70 billion. That would be almost double Fort Motor Co.’s market value of roughly $40 billion, but far less than the total value of Toyota’s shares of about $120 billion.
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