In House - The FindLaw Corporate Counsel Blog

July 2010 Archives

GM to Buy AmeriCredit for $3.5B

What's $3.5 billion from one company to another? For General Motors, it's the cash needed to acquire AmeriCredit Corp. The deal is designed to give auto dealers an additional option for financing cars for buyers of new vehicles. Since 2006, GM buyers have faced less appealing financing options than GM had offered in the past. With the AmeriCredit deal, they expect to be able to offer better financing terms, particularly for sub-prime borrowers. In addition, they plan to greatly expand their vehicle leasing options.

The purchase has been a long time in the making. According to GM, the two companies have been working together for some time and over 4,000 dealerships already have relationships with AmeriCredit.

GM chairman and CEO, Ed Whitacre praised the purchase:

This acquisition supports our efforts to design, build and sell the world's best vehicles by expanding the financing options we can offer to consumers who want to buy GM vehicles ... Adding AmeriCredit to our team will improve our competitiveness in auto financing offerings, and I am very pleased to have them on board.

Congress Passes Movie Futures Trading Ban

Have you ever had a client that wanted to invest in movie futures? It's an idea that's had a lot of appeal to a number of investors. Cantor Fitzgerald's Cantor Exchange and Media Derivatives' Trend Exchange had been working for years to create an online trading for Hollywood films. However it was strongly opposed by the Motion Pictures Association of America and the six major studios it represents. Now the U.S. Senate has put an end to the idea once and for all.

When the U.S. Senate approved financial reform on Thursday with a vote of 60-39, it included a ban on treating the Hollywood box office as a commodity market with a futures market. The legislation, proposed by the Obama administration, will tighten controls on financial markets. The measure was approved by the House of Representatives last month. The legislation comes after calls for action to regulate markets following the 2008 financial crisis.