Business

GM to resume dividend; names new CFO

GM was widely expected to restore its dividend after the US government sold its remaining stake in the company late last year.
STAN HONDA/AFP/Getty Images/File
GM was widely expected to restore its dividend after the US government sold its remaining stake in the company late last year.

DETROIT — General Motors Co. said Tuesday that it will resume paying a quarterly dividend for the first time in nearly six years and named a new chief financial officer.

The new 30-cent dividend is payable in March.

Detroit-based GM hasn’t paid a dividend since June 2008, when it suspended its 25-cent dividend as it spiraled into debt and eventual bankruptcy.

Advertisement

Shares rose 3 percent in after-hours trading to $41.25.

Get Talking Points in your inbox:
An afternoon recap of the day’s most important business news, delivered weekdays.
Thank you for signing up! Sign up for more newsletters here

GM was widely expected to restore its dividend after the US government sold its remaining stake in the company late last year. The Treasury received the stake in 2009 in exchange for a $50 billion bailout that saved GM from financial ruin. It ended up losing about $10 billion on the bailout.

And GM competitor Ford Motor Co. said last week that it would increase its quarterly dividend to 12.5 cents per share, up from 10 cents. It was the second time Ford has raised the dividend amount since it reinstated its dividend in 2012.

GM chief executive Dan Akerson had hinted that a dividend might be coming. Akerson told reporters last month that since GM retired preferred stock that carried high dividend rates and payments, it now has enough money to maintain capital spending and reward shareholders. GM has made more than $21 billion in profits since emerging from bankruptcy in 2009.

The announcement came the day before Akerson is expected to step down. Mary Barra was named the automaker’s new chief executive last month.

Advertisement

GM also said Tuesday that Chuck Stevens will become finance chief on Wednesday. Dan Ammann will become the company’s president. Stevens had been finance chief of GM’s North America division.