DETROIT (Bloomberg) -- Ally Financial Inc., the auto and home lender preparing for an initial public offering, delayed plans to start marketing the IPO until equity markets improve, according to a person familiar with the plans.
The company is moving ahead with the process so that it can sell shares once market conditions improve, according to the person, who declined to be identified because the plans aren't public.
Ally - formerly GMAC - had been working toward a $5 billion to $7 billion sale in late June, people familiar with the company's proposal said earlier this year.
Jim Olecki, a spokesman for the Detroit-based bank, and Matt Anderson of the U.S. Treasury Department declined to comment.
The Treasury had been seeking to wind down its 73.8 percent stake in the lender. The Standard & Poor's 500 Index rose for the first time in seven trading days Thursday, ending its longest slump since February 2009.
The Financial Times reported Thursday that Ally is dropping the IPO because of market conditions and possible fines related to foreclosure practices, without saying where it received the information.
The U.S. government rescued Ally as part of efforts to bail out GM and Chrysler. At the time of the federal bailout, Ally was majority-owned by Cerberus Capital Management LP, with GM retaining a 49 percent stake.
Today Cerberus has an 8.7 percent stake in Ally, and a GM trust owns 9.9 percent. A group of third-party investors controls the remaining 7.6 percent stake.