KIRK Kerkorian, the billionaire investor who tried to overhaul General Motors Corp three years ago, said yesterday that he has bought a 4.7-percent stake in Ford Motor Co and plans to buy more.
Kerkorian holds 100 million shares in the No. 2 United States car maker, according to a statement yesterday from his Tracinda Corp. Tracinda intends to make a tender offer for an additional 20 million shares at US$8.50, a 13.3-percent premium over the US$7.50 closing price on Friday.
Kerkorian's company bought the initial 100 million shares at an average price of about US$6.91 per share.
Kerkorian's investment company has been following Ford "closely" since the company released its fourth quarter 2007 results and the progress "indicated that Ford's management was starting to achieve highly meaningful traction in its turnaround efforts," the statement said.
"Last week this was reinforced by Ford's first quarter 2008 results, achieved despite the difficult US economic environment," Tracinda said in the statement. "Tracinda believes that Ford management under the leadership of Chief Executive Officer Alan Mulally will continue to show significant improvements in its results going forward."
The car maker reported a US$100-million first-quarter profit last week. Ford rose 7.3 percent to US$8.05 a share before regular New York Stock Exchange composite trading.
"We welcome confidence in Ford and the progress we are making on our transformation plan," Mulally and Chairman William Clay Ford Jr said in an e-mailed statement.
Yesterday's announcement marks Kerkorian's third major investment in a US car company. Kerkorian, 90, made an unsuccessful takeover bid for Chrysler Corp in 1995. In May 2005 he disclosed his initial stake in GM, later becoming the biggest individual shareholder in the world's largest auto maker.
Kerkorian later pressured GM to put his adviser Jerry York on the car maker's board. Kerkorian then urged General Motors CEO Rick Wagoner to seek an alliance with Carlos Ghosn's Renault SA and Nissan Motor Co.
York quit the board, and Kerkorian sold his GM stock when Wagoner decided to remain independent.
Tracinda spokesman Tom Johnson told Bloomberg News that he had no comment beyond the statement.