By Jay Heflin - 08/13/10 07:22 PM EDT
"More than $40 billion in tax dollars is tied up in GM stock, so the stock sale is risky for the public," Grassley said in prepared remarks. "The Treasury Department needs to minimize the risk for taxpayers."
The share offering is expected to be announced next week, and Grassley hopes taxpayers will recoup the $43 billion GM still owes from the $49.5 billion government bailout in 2009. He contends the stock must be valued at more than $70 billion for taxpayers to break even.
"Hopefully, when the dust settles, the taxpayer will not have lost billions of dollars on GM," he wrote.
The senator also asked the Treasury to disclose the transaction costs that will be paid to investment banks for managing the stock offer. He stresses that the disclosure should be before, not after, the sale to ensure taxpayers are getting the best deal.
"There is no reason that this should not be determined before, rather than after, the transaction is complete," he wrote, adding that if Barofsky encounters trouble obtaining the information he should contact Grassley immediately.