Citigroup (NYSE: C) and Goldman Sachs (NYSE: GS) have been hired by GMAC Inc to explore options for repaying its bailout funds related to the Troubled Asset Relief Program, according to several sources.
GMAC head Michael Carpenter was tasked with returning the lender to profitability and getting the company’s bailout funds repaid when he became CEO in November 2009.
The Detroit-based auto and home lending company received $17.3 billion worth of taxpayer funds is now looking for what anonymous sources are referring to as “strategic alternatives”, which may indicate a sale of the unit or a shut-down of the business.
The New York Post commented that Goldman Sachs was hired by the company on March 12th.
Many believe that GMAC’s best shot at repaying its TARP debt is through an initial public offering. CEO Michael Carpenter said during a hearing for the Congressional Oversight Panel on TARP that the company would likely see an IPO during the next two years.
The same oversight panel said earlier this month that GMAC may be unable to fully repay its debt related to the Troubled Asset Relief Program and the rescue may cost taxpayers an additional 46.3 billion.
GMAC is currently 56.3% owned by the U.S. government.
