Cerberus Capital Management, managed by Stephen Feinberg, has revealed a new position in Ally Financial Inc (NYSE:ALLY). A new filing with the Securities and Exchange Commission showed that the fund owns 41.52 million shares of Ally Financial Inc (NYSE:ALLY). The stake represents 8.6% of common stock outstanding.
On March 25, 2014, Ally Financial Inc (NYSE:ALLY), FIM Holdings LLC, a fund affiliated with Cerberus, and the United States Department of the Treasury entered into a stockholders agreement. The stockholders agreement provides, among other things, that for so long as FIM and its affiliates hold at least 5% of the shares of the common stock, FIM will have the right to designate one nominee to the company’s board of directors. In addition, pursuant to the stockholders agreement, for so long as FIM and its affiliates hold any of the common stock, they will be entitled to appoint one non-voting observer to the company’s board.
Ally Financial Inc (NYSE:ALLY) is an automotive financial services company powered by a top direct banking franchise. Recently, the company launched its initial public offering of 95 million shares of common stock at a price to the public of $25 per share. The underwriters have a 30-day option to purchase up to an additional 14,250,000 shares of common stock from the U.S. Department of the Treasury at the initial public offering price.
In connection with the company’s IPO, Mr. Feinberg entered into a lock-up agreement un which Mr. Feinberg has agreed, subject to limited exceptions, not to enter into certain transactions related to the common stock for a period of 180 days after the date of the final prospectus filed in connection with the IPO, without the prior written consent of Citigroup Global Markets Inc., the lead underwriter.
In addition, FIM and certain of its affiliates have also entered into a lock-up agreement under which FIM has agreed, with respect to 40% of the shares of the common stock beneficially owned, directly or indirectly, by FIM or its affiliates, not to enter into certain transactions related to the FIM lock-up shares for a period of 120 days after the date of the final prospectus filed in connection with the initial public offering, without the prior written consent of Citigroup Global Markets Inc.
Cerberus Capital was founded in 1992 and holds a mid-sized equity portfolio with its fingers in the services and industrial sectors. In its latest 13F, Cerberus Capital revealed its holdings only three companies in its equity portfolio at the end of the fourth quarter of 2013. On the top of the list is BlueLinx Holdings Inc. (NYSE:BXC), in which the fund’s stake remained unchanged at 47.14 million shares.