NEW YORK — General Motors stock began trading on Wall Street again Thursday, signaling the rebirth of an American corporate icon that collapsed into bankruptcy and was rescued with a $50 billion infusion from taxpayers.
The stock rose sharply in its first minutes of buying and selling, going for nearly $36 per share — almost $3 more than the price GM set for the initial public offering. The stock pulled back slightly by early afternoon and closed at $34.19. It had traded for less than a dollar when the old company filed for bankruptcy last year.
On the floor of the New York Stock Exchange, a crowd eight deep jostled around the company's trading post, adorned with its familiar blue-square logo with an underlined "GM." CEO Dan Akerson rang the opening bell as raucous cheers went up and the sound of a Chevrolet Camaro's revving engine echoed through the room.
The government hopes that the stock offering will be the first step toward ultimately breaking even on the bailout. For that to happen, it needs to sell its remaining GM holdings for an average of roughly $50 a share over the next several years.
President Barack Obama said GM's return to trading shows the "tough decisions that we made" during the financial crisis were paying off. He said Americans are positioned to recover the money his administration put into GM.
Ron Bloom, Obama's senior adviser for the auto industry, refused to predict whether taxpayers would get all $50 billion back.
"We're obviously eager to get the rest of it back as much as we can," he said Thursday.
The GM IPO could wind up as the largest in history. Earlier this week, GM raised the high end of its initial price range from $29 to $33 and increased the number of shares it was offering from 365 million to 478 million common shares because investor demand was so high. Counting preferred stock issued by the company, the deal's value could top $23 billion.
At the market's close, GM shares had changed hands more than 456 million times, almost matching the number of shares sold in the IPO.
Such volume is not unusual following a high-profile offering. It's a sign that big institutional investors such as mutual and hedge funds are taking profits and smaller investors who were shut out of the IPO are now buying, said David Whiston, an auto equity analyst with Morningstar Inc.
"Often the way the world is, the Wall Street institutions get in at the lower price and the Main Street investor gets in at the higher price," he said.
The increased selling price, though, means the market is judging the GM rescue as a success, Bloom said.
"Almost $20 billion in private capital voted that they wanted to be part of General Motors. So we do think this is a good day," he said.
In the initial offering, the government reduced its ownership stake from 61 percent to about 36 percent. The federal treasury sold 358 million shares of the resurrected GM — which is smaller, profitable and cleansed of most of its debt. If bankers exercise options to buy and resell more shares, the government will wind up selling more than 400 million shares, reducing the stake to 33 percent of GM.
"There's a lot of work to do, but today is the beginning of the new company," said Mark Reuss, GM's North American president.
The reduced government stake should help repair the company's image, which had been tarnished by accepting the bailout money, Akerson told reporters.
"They have taken their ownership down by roughly half," he said. "I would say that the average taxpayer in the United States would look at this particular transaction as very positive."
The stock offering is the latest in a series of head-spinning developments over the past two years for the American corporate icon.
In September 2008, to mark its 100th birthday, GM celebrated in the grand three-story atrium on the ground floor of its Detroit headquarters.
Two months later, then-CEO Rick Wagoner found himself in front of members of Congress, begging for money to keep GM alive. Four months after that, he was ousted by Obama.
By June 2009, GM had filed for bankruptcy. It emerged with 92 percent of its debt erased, but the company was mostly owned by the government and saddled with a damaging nickname: "Government Motors." The value of its old stock was wiped out, along with $27 billion in bond value.
Now GM is a publicly traded company again with the familiar stock symbol "GM."
GM set aside 5 percent of its new stock for employees, retirees and car dealers to buy at the offering price. The company has not revealed how many people took the offer.
Early Thursday, GM's main joint venture partner in China, SAIC Motor Corp., said it has bought a nearly 1 percent stake in GM, buying shares being offered in the IPO at a cost of nearly $500 million. SAIC, based in Shanghai and run by the state, said the purchase is meant to enhance cooperation with GM in China, the world's biggest auto market.
GM chief financial officer Chris Liddell said there was high interest in the IPO from sovereign wealth funds, which are pools of money from reserves of foreign governments. In the end, 90 percent or more of the shares were sold in North America, he said.
About $4 billion worth of shares went to smaller retail investors, the most of any IPO in history, Liddell said. But many retail investors are high net worth clients of Wall Street brokerage houses.
Senior Obama administration officials said Wednesday that the Treasury Department sought a balance between getting a return for taxpayers and exiting government ownership as soon as practical.