Kerkorian Seeks Bigger Piece Of GM

General Motors Corp. dissident shareholder Kirk Kerkorian's Tracinda Corp. has told GM it is interested in acquiring up to 12 million more shares of the company, which would give it more than a 10 percent stake, as the world's largest automaker continues discussions with Renault and Nissan about a three-way alliance.

Tracinda already owns 56 million shares, or 9.9 percent of GM's common stock. Going over 10 percent would require a number of regulatory approvals because the company owns banking and insurance interests.

Tracinda said in a Securities and Exchange Commission filing that it also still supports the alliance between GM and automakers Renault SA of France and Nissan Motor Co. Ltd. of Japan.

"Tracinda continues to believe that a strong opportunity exists in a potential alliance between General Motors, Renault and Nissan, and that there should be strong General Motors Board involvement in the analysis of such a potential alliance, including the utilization of independent advisors," Tracinda's filing said.

GM currently has about 565.6 million outstanding shares. A Tracinda purchase of 12 million more shares would bring Kerkorian's stake to 12 percent of the company.

"We are seeking the cooperation and support of the company and its management in connection with these filings and any related proceedings, as we believe additional investment by Tracinda in GM would be viewed positively by investors, and your support will maximize the likelihood of obtaining regulatory approval," the filing said.

In the filing, in the form of a letter to GM Chairman and Chief Executive Officer Rick Wagoner, Tracinda told GM it is interested in buying 6 million shares of common stock on the open market and may consider buying an additional 6 million shares.

The letter was filed Thursday morning with the Securities and Exchange Commission.

In a statement, GM said Tracinda told the company of its intent Wednesday night, saying that it would update its filings with the SEC.

The move comes just after Wagoner met with Carlos Ghosn, who heads Renault and Nissan, in Paris on Wednesday and agreed to continue talking about the alliance even though the talks are running into difficulties. The talks are taking place at the behest of Kerkorian and Jerome York, Tracinda's representative on the GM board.

Renault and GM representatives on Wednesday would not say whether the meeting had addressed differences between Ghosn and Wagoner over how much each side's shareholders would stand to benefit from an alliance.

According to a report in The Wall Street Journal, Wagoner is pressing Ghosn for a multibillion dollar payment to GM as part of any alliance deal, insisting that his shareholders would otherwise be shortchanged.

Brian Akre, a spokesman for the U.S. automaker, said GM believed that "the benefit from the synergies that have been discussed are disproportionate."

He added: "GM would be looking at ways to alleviate that concern. Speaking hypothetically, that could include a payment, that could include a number of different options."
By Tom Krisher