Ford Shareholders to Kerkorian: "Take My Stock. Please."

Stockholders representing more than one billion shares of Ford stock aren't waiting around to see what Kirk Kerkorian intends to do with Ford. They want to sell now, and small wonder: Kerkorian offered $8.50 per share, versus Ford's closing market price of $6.36 on June 9, when the tender offer expired.

Does Kerkorian see value others don't? You have to admire a 90-year-old investor who buys for the long term. Kerkorian, as usual, has said nothing publicly about his plans.

His adviser Jerry York, a former Chrysler CFO, incautiously told Automotive News on May 1 he thinks Ford should somehow sell Volvo and Mercury. Since then, Kerkorian's PR advisers have not made York available.

Beyond that, Kerkorian's Tracinda has said only, "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," or platitudes to that effect.

Like other Detroit Three executives who have been the object of Kerkorian's attention before now, Mulally would do well to listen carefully to York and Kerkorian, while keeping his hand on his wallet.

Kerkorian announced on April 28 he was seeking 20 million shares, or less than 2 percent of the shares that were ultimately offered. Because so many shareholders offered to sell, Tracinda will prorate its stock purchases among the would-be sellers. The additional 20 million shares take Kerkorian's stake in Ford to 120 million shares, or about 5.6 percent of the outstanding shares.

Kerkorian owns Tracinda, based in Beverly Hills, and a majority share of MGM Mirage. Since the late 1980s, he has twice tried to take over Chrysler.

In 2000, Kerkorian filed an lawsuit, accusing then-DaimlerChrysler CEO Juergen Schrempp of misleading shareholders, including Kerkorian, by characterizing the 1998 DaimlerChrysler merger as a quote-unquote "merger of equals."

In another one of those indiscreet interviews, Schrempp had told the Financial Times that he, Schrempp, had fooled everybody by cleverly downplaying the fact that in reality, Daimler AG was taking over Chrysler.

Kerkorian's lawsuit was absurd. Schrempp's boasting was equally absurd. And so was testimony from former Chrysler boss Bob Eaton, who personally made millions on the deal from the value of his stock, to the effect that he was shocked, shocked and appalled to find out that the DaimlerChrysler merger was actually a takeover.

It was clear to absolutely everybody at the time, including us untutored reporters, that Daimler was the dominant partner, and that the term "merger of equals" was a term for a particular deal structure, chosen for tax purposes. My layman's understanding at the time was, if Daimler said it was buying Chrysler outright, it would have to pay a big tax bill. It was a tax dodge, it was never meant literally as a promise that Chrysler would somehow be "equal."

Yet Kerkorian had the chutzpah to ask a federal court in Delaware for $1 billion in damages. The damages were eventually thrown out of court, and affirmed when Kerkorian had the double-chutzpah to appeal.

More recently, Kerkorian and York also took a run at General Motors in 2006, quitting that when GM pointedly declined to follow York's advice that GM should conclude an alliance with Carlos Ghosn's Nissan.

York also told GM it should dump Hummer the minute it stops making money. GM seems to be taking York's advice on that one, although with $4 gasoline it's now an obvious call.

All of which is to say that while Kerkorian ipso facto is one smart guy, he's also perfectly capable of espousing baloney like that "merger of equals" lawsuit, if it suits him. That means, at the very least, that it will be entertaining to see the outcome of his present run at Ford.