By David Shepardson; The Detroit News ~ Aug 11, 2010

Washington -- General Motors Co. plans to file paperwork to launch a public offering on Friday, two people briefed on the matter said today.

The move -- first reported by CNBC -- will allow GM to begin selling shares before year's end, and will come a day after the company will report a profitable second-quarter results.

GM chairman and CEO Edward Whitacre Jr. told The Detroit News in an interview last week that GM would be solidly profitable the rest of the year. He also hinted GM would post better results in the second quarter than it did in the first quarter, when it earned $865 million.

One person briefed on the matter said GM is expected to report more than a $1 billion profit tomorrow, including strong results in North America, Brazil and China.

Whitacre said the Treasury Department will shrink its 61 percent stake to under 50 percent during the first sale -- but he said he hoped it was far more than that. The government swapped about $43 billion of its $50 billion government bailout for its majority stake in the Detroit automaker.

"We want the government out. Period," he said.

GM lost $88 billion in the four years leading up to the company's bankruptcy filing. The results could be GM's best half-year performance in six years.

Whitacre said in an interview last week that GM needed to complete talks on securing a $5 billion revolving line of credit before it could go public.

GM spokeswoman Lori Arpin didn't confirm or deny the reports.

"We are not going to comment on the reports. We'll go when the conditions are right and GM is ready," she said.

A Treasury Department spokesman also declined to comment.

GM's filing -- more than 300 pages -- will detail its business plans and public offering details. Whitacre told reporters in Traverse City last week that the document is about four inches thick.

Company executives and advisors will then mount a "road show" to sell the GM public offering.

GM was once one of the nation's most widely held stocks and had a market capitalization of $52 billion in 2000. After the old company filed for bankruptcy, shareholders were nearly wiped out. GM Co. was formed by the government-sale of most of the old company's assets to form a new firm.

Also unclear is how much stock -- if any -- the other shareholders will sell in an initial offering. A United Auto Workers health care trust fund holds 17.5 percent, the Canadian governments hold 11.7 percent and GM's former bondholders own 10 percent.

A filing Friday would be on schedule. UAW President Bob King said last month that GM would make its filing by mid-August.

Separately, GM's board of directors met last Tuesday -- and held GM's annual meeting behind closed doors, according to a company filing this week.

The board approved changes to its bylaws -- another move ahead of going public. The new rules include a requirement that a shareholder hold at least 25 percent of GM stock to call a special stockholders meeting.

GM was once of the most widely held stocks in the United States -- and one of the strongest blue-chip firms. From 1917 until 1962, GM went from 3,000 shareholders to more than 1 million, former GM CEO Alfred Sloan wrote in his 1963 book.

The Securities and Exchange Commission generally takes 60 to 90 days to approve a company's registration statement.

The filing will contain GM's "prospectus" -- a detailed business case and recent financial results. It will make the case for why people should invest in the Detroit automaker. It will also highlight risks to GM's business plans.

It should have lots of information -- like what stock exchange GM will trade on and what stock symbol it will use. It will also disclose whether GM plans to start paying dividends again.

GM will also likely update the registration statement several times before going to market with its shares.

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