Details of GM’s cash lifeline

Following up from my GM Cash post,  General Motors (GM) recently published an abbreviated set of finacials to the public which provided clarity around the liquidity of the firm.

The filing confirmed that the company has entered into a loan arrangement with the US Department of Treasury for $13.4 Billion in three installments.  As of Dec 2008, the cash balance totaled $14.0 Billion down $2.3 Billion from the previous quarter.  Adjusting the $14.0 Billion downwards for the $4.0 Billion government installment loan, the company’s burn rate was approximately $70 Million a day, slightly higher than my estimate.

Let’s see what the future holds for GM….will they become another Citi (C) with a major shareholder being in the US government?

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Author Disclosure: At the time of posting, I am neither long nor short any shares of GM or C.

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