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March 24, 2008 |
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GMAC LLC: Financial Unit's Board Names Alvaro de Molina as CEO The Board of Directors of GMAC LLC subsidiary, GMAC Financial Services, named Alvaro G. de Molina as chief executive officer of the unit, effective April 1, 2008. Mr. de Molina will oversee all GMAC operations and focus on strengthening the core businesses, while positioning the company for long-term growth. Eric Feldstein, currently chief executive officer, will join Cerberus Capital Management L.P., an affiliate of which holds a majority interest in GMAC. In his new role, Mr. Feldstein will advise Cerberus in connection with its large financial services portfolio and with new investment opportunities in financial services and other sectors. "Al brings extensive experience in financial services and banking to the GMAC CEO role, with keen insight into the needs of customers and investors alike," said J. Ezra Merkin, chairman of GMAC's Board of Directors. "We are pleased that he will be able to draw upon the experience and know-how of the senior GMAC team. We are confident that the combination of Al's leadership and the contributions of senior management will enhance the company's efforts to restore profitability and pursue growth opportunities." Mr. de Molina had a long and successful career with Bank of America before joining GMAC in August 2007. He said: "GMAC's key strength is its strong foundation, which includes a vast dealer network, a global footprint, a large customer base, and a talented team of employees -- all of which are essential to the longer-term success of the business. Looking ahead, we need to align our resources to reflect the current market environment and capitalize on our competitive advantages." During the past year, the GMAC leadership team has maintained the company's strong liquidity position, reduced leverage, tightened underwriting standards, reduced risk, introduced new products for both the automotive finance and insurance businesses, and structured the company for efficient, scalable growth. The company has also enhanced its global risk management function, broadened its marketing focus, and bolstered the leadership team in the mortgage business amid a challenging market environment. GMAC's management team today reflects a complement of seasoned executives with experience at the company and new leaders with expertise in running a global financial services enterprise. Looking forward, GMAC continues to target a return to profitability, while maintaining or improving its global leadership position in its core businesses. Mr. Feldstein served as the chairman and then chief executive officer at GMAC Financial Services since November 2002, and previously served at General Motors Corp. as treasurer and vice president of Finance, among various other executive positions. "We are very pleased to bring Eric on board to the Cerberus team," said Mark Neporent, chief operating officer of Cerberus. "We expect that Cerberus and its investors will benefit from Eric's broad expertise in financial services and other sectors." Background Information on Al de Molina Mr. de Molina is a proven leader with experience in effectively managing risk and capital while building strong, talented teams. Before he joined GMAC last year, he spent 17 years at Bank of America, most recently serving as chief financial officer. During his tenure at Bank of America, he also served as chief executive officer of Banc of America Securities, president of global corporate and investment banking, and corporate treasurer. Prior to joining Bank of America, de Molina served in the lead financial role for emerging markets at J.P. Morgan. He began his career in 1979 with PriceWaterhouse. Mr. de Molina serves on the boards of Duke University's Fuqua School of Business, the Foundation for the Carolinas, Florida International University, and the Financial Services Volunteer Corps. Born in Cuba, he holds a bachelor's degree in accounting from Fairleigh Dickinson University, and a master's degree in business administration from Rutgers Business School. About GMAC GMAC LLC, based in Detroit, is a provider of retail and wholesale auto financing, auto insurance and warranty products, and through its wholly-owned subsidiary Residential Capital LLC, residential mortgage products and services. GMAC reported a preliminary 2007 fourth quarter consolidated net loss of $724 million. GMAC LLC has a subsidiary in India called GMAC Financial Services India Limited. * * * As reported in the Troubled Company Reporter on March 5, 2008, Fitch Ratings has downgraded and removed from Rating Watch Negative the long-term Issuer Default Rating GMAC LLC and related subsidiaries to 'BB' from 'BB+'. Fitch has also affirmed the 'B' short-term ratings. Fitch originally placed GMAC on Rating Watch Negative on Nov. 14, 2007. The Rating Outlook is Negative. Approximately US$100 billion of unsecured debt is affected by this action. As reported in the Troubled Company Reporter on Feb. 25, 2008, Standard & Poor's Ratings Services lowered its ratings on Residential Capital LLC and GMAC LLC. Residential Capital LLC was downgraded to 'B/C' from 'BB+/B'. GMAC LLC was downgraded to 'B+/C' from 'BB+/B'. S&P said the outlook for both entities is negative. |
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