Ally Financial Inc's (NYSE:ALLY) initial public offering has been priced at $25 per share, an underwriter said, valuing the bailed-out auto lender at about $12.04 billion.
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Ally's IPO raised $2.38 billion, after the offering of 95 million shares was priced at the low end of its expected range. The company previously said it expected to price its offering at between $25-$28 per share.
Ally's IPO is the biggest U.S. offering so far this year, eclipsing that of Santander Consumer USA Holdings Inc (NYSE:SC) and IMS Health Holdings Inc (NYSE:IMS).
While Santander Consumer, the auto-finance unit of Spanish bank Santander (TICKER:SAN), raised $1.8 billion in January, IMS Health raised about $1.30 billion last week.
The US Department of Treasury is selling all the shares of Ally in the offering.
The Treasury, which held 36.8 percent of Ally before the offering, will see its stake fall to 14.1 percent if underwriters exercise an option to sell additional shares on behalf of the government.
Activist investor Daniel Loeb's hedge fund Third Point LLC and Cerberus Capital Management are not selling any of their shares in Ally in the IPO. Third Point has a 9.5 percent stake, while Cerberus Capital owns an 8.6 percent stake.
The auto lender was bailed out for $17.2 billion during the 2008 financial crisis. Ahead of the IPO, taxpayers have recovered $15.3 billion.
Shares of the Detroit-based company are expected to start trading on Thursday and list on the New York Stock Exchange under the symbol "ALLY."
Ally initially filed for an IPO in March 2011 but repeatedly delayed its plans due to market conditions and as it faced potential fines over its mortgage lending practices.
The company's net income fell to $361 million from $1.20 billion in 2013. Total net revenue fell about 4.5 percent to $4.26 billion during the period.
Ally's fourth-quarter profit was hurt by a charge to settle allegations by regulators that it discriminated against minorities in auto lending.
The company's auto finance business also slowed in the quarter, with new loans falling 8 percent to $8.2 billion as its agreement as Chrysler's preferred lender expired.
Citigroup, Goldman Sachs & Co, Morgan Stanley and Barclays are the lead underwriters for the offering.
(Reporting by Avik Das in Bangalore; Editing by Sriraj Kalluvila)