Ally to sell Europe, Latin America operations to GM

  • Ally Financial announced on Wednesday it is to sell its Europe and Latin America operations to GM Financial, a unit of General Motors, for $4.2 billion.

    The combined operations in Europe and Latin America make up about $16.1 billion in assets at the end of the third quarter, Ally said in a statement.

    The deal involves two companies that are still partially owned by the U.S. government following a series of bailouts.

    Both companies also have a linked history, with Ally once the financing arm of GM, which was known as GMAC.

    The sale is expected to add $300 million to $400 million to GM Financials’ yearly earnings before taxes.

    GM is likely to contribute about $2 billion in cash to GM Financial to fund the purchase, the automaker said in a separate statement.