More behind GM stock reaction to pension buyout plan
Any news that reduces burden and costs to General Motors Company (NYSE: GM) should be viewed as great news to GM stock holders. Problem is, looking at the 5-minute intraday chart, the market didn’t quite see it that way, as GM stock popped up on the news, but fell back later in the day. Question is: why? And what does this move portray for the country?
For the record, I am one of those retirees who may receive the lump-sum offer as the letter arrived in today’s mail; wonderful timing I might add. According to the GM news release (which I read later), the retirement plan actions will result in an expected $26 billion reduction of GM’s U.S. salaried pension obligation.
Furthermore, not every retiree will get the offer. I would have paid to be a fly on the wall for those meetings which determined the criteria.
Also according to the news release and the letter, select U.S. salaried retirees will receive a lump-sum payment offer and other retirees will receive a continued monthly pension payment securely administered and paid by The Prudential Insurance Company of America, a Prudential Financial, Inc. company. Again, what criteria determines who gets on the select list? No surprise, GM never reveals those kind of details.