Did anybody hear today that someone bought a large portion of GM?

[TNOE]

I read an article yesterday which addressed the fear of GM possibly going bankrupt - which would be disastorus for a whole lot of people. Any insight from any one? Thanks in advance.

[underpants]

1. No but I hope it was Michael Moore

:bounce: Wouldn't that be sweet?

[TNOE]

4. Yes it would

paging Mr. Moore - Mr. Michael Moore - answer the red phone please!

[Jon8503]

2. Yes, here is an excerpt from The Wall Street Journal

Shares of General Motors rose some 18% after Kirk Kerkorian's Tracinda Corp. said it planned to buy 28 million shares of the auto maker at $31 each.

That news helped boost the market, with the Dow Jones Industrials Average jumping 127.69 points to 10384.64. The Nasdaq Composite Index was up 29.16 to 1962.23.

GM gained $5.03 to $32.80. The Kerkorian offer is without consideration to GM's quarterly dividend of 50 cents a share and represents a premium of 13.43% over its Monday closing price of $27.77. After the transaction, Tracinda, which already owns 3.89% of GM, would control 8.84% of the auto giant, or 50 million shares.

[TNOE]

6. Wow, thank you for the great info Jon

Do you know anything off hand about this Tracinda Corp? Or do you have any general feelings (anyone for that matter) on if GM will pull out of their slump?

I'm afraid they'll bankrupt on purpose to get rid of their pension and health benefit responsibilities.

[nonconformist]

7. The very thought makes me all tingly

I'm from Michigan, and many members of my family are employed by GM or on pension now. I can't fathom...

[tammywammy]

18. I feel the same

Though, none of my family works for GM, but we have a GM factory here in Arlington. It will hit very hard if they start laying off those people

[Jon8503]

15. Not sure; don't know that much about the situation except they

have the problem of their pension health care benefits. Something is going to give there probably. They have enough assets probably to keep from having to go bankrupt. You might see them get rid of some of their car divisions like Buick, Chevrolet; something like that. I did not mean those two specifically, just stating they could sell one or more of those to slim down some. GM has always had too many car divisions and need to concentrate on fewer and make a better product.

The above is all just some speculation from some reads about them so don't bank on any of it.

[Stinky The Clown]

21. The killed Olds off a few years ago

They may already be out of the market. Buick is still a good brand for them. Chevy would be the last to go. Pontiac is aimed at their 'performance' buyers and Caddy ... well ... Caddy's Caddy. Saturn's theirs too.

If anything, I could see them selling off some of their European brands (Saab comes to mind) They'd probably keep Opel (Germany), but they might also consider their UK plants expendable ...... and maybe their deal with/interests in Toyota.

I think they're a long, long way from bankruptcy .... unless its to welch on their pension deal with the 'slaves' (hardworking blue collar guys like my Dad was) who gave them their lives.

[patricia92243]

3. I heard it this morning on Public Radio. Didn't know the guy, so can't

remember his name. I was surprised because I was thinking "why would anybody buy shares of a bankrupt company".
Wonder if Japan will buy it if it does go bankrupt, and this guy know the inside story.?

[Spinzonner]

8. He probably has some plan to dump the pension obligations

like the bankrupt airlines are (trying) to do.

[sam sarrha]

11. the Taxpayers will pick up the pensions.. they are guranteed by the gov'..

[madmom]

12. I don't know..are you sure about that?

I'm a gm wife and have never heard of this.

[oregonjen]

14. Are you sure?

My friends husband works for a major airlines and the talk is he, along with everyone else, will lose their pensions.

[satya]

20. I heard United Air's pensions were turned over to ERISA, will pay 10 cents

on the dollar. It's a federally administered program, but not a taxpayer bailout program like the S&L bailout in the 80s.

[Cleita]

9. Isn't this part of buying a stock when it's down?

DH & I bought 100 shares of IBM, when it almost tanked, before they restructured it and brought in Lou Gerstner as CEO. Everyone told us we were crazy. The only regret we had was that we didn't invest a whole lot more money in it.

[orwell]

5. Captain Kirk

Kirk Kerkorian said that he wanted to increase his stake in GM by 28 million shares. He was willing to pay $31 a share. That helped to kick off a Dow rally which for various reasons extended to a 1.24% increase in the index.

He already owns 22 million shares of GM

http://quote.bloomberg.com/apps/news?pid=10000006&sid=awul0fSMlCQk&refer=home

[madmom]

13. yeah but I think they said it's only like 9%...n/t

[orwell]

19. Plenty

9% of a company the size of GM gives you a lot of board clout. Ask Howard Hughes or Ross Perot (Remember the Class H and E shares)

[madmom]

22. this is true, but not controlling..n/t

[sam sarrha]

10. a demolition and scrap steel company..

[Jon8503]

16. A little more on Kerkorian

GM's Back-Seat Driver

By MARK GONGLOFF
THE WALL STREET JOURNAL ONLINE


With the sword of Damocles hanging over its credit rating and its stock as popular as a skunk at a garden party, General Motors got a shot in the arm from an octogenarian would-be rescuer today -- though GM's management may not welcome the help, and more peril surely lies ahead.

Legendary corporate nag (some say "greenmailer") Kirk Kerkorian, the 87-year-old billionaire owner of MGM Mirage, made the stunning announcement that he wanted to buy up to 28 million shares of GM at $31 a share, which is sort of like walking into a dollar store and insisting you'll pay no less than $5 for every item. "He clearly could've bought it at $27 or lower today and for the next two weeks," said Calyon Securities analyst Joseph Amaturo.

The purchase will boost Mr. Kerkorian's stake in GM, which yesterday reported another month of slumping sales, to nearly 9%. Some cynics suspect that Mr. Kerkorian's plan is simply to be so annoying that management will pay him to vamoose. "Kerkorian is no spring chicken," said Barry Ritholtz, chief market strategist at the Maxim Group. "Is he planning to oversee a five-year turnaround plan?"

But Mr. Amaturo believes that, by offering a premium for GM's radioactive shares, Mr. Kerkorian signaled his intention to stick around for a while. The analyst raised his rating on GM to "add" from "sell" and boosted his price target to $35 from $20. GM's stock soared 18% on the Tracinda news, though not all of that was happy money; GM shorts wished they'd stayed in bed. GM's swooning bonds, which have one foot in "junk" land, rebounded.

[Jon8503]

17. The rest of the story - Subscription so could'nt get it all at once here

Mr. Kerkorian claimed the bid was for "investment purposes" only, disavowing any interest in running GM -- a claim as believable to most analysts as the idea that sports odds are for "entertainment purposes" only. Mr. Kerkorian made a similar claim when he bought into then-struggling Chrysler in 1990. Instead, he rode herd on management, Chrysler turned around, and he turned a sweet profit.

The GM bid may not work out so well. GM faces gargantuan employee-benefit costs and shrinking North American market share. Mr. Kerkorian could try to break the company up, spinning off its valuable non-auto assets, but he may not own enough of the company to do that. "The best he can hope for is that it gives him more influence over some of the decisions GM's management makes," said Argus Research analyst Kevin Tynan. "But I can't see why they would turn around to this guy and say, 'Thanks for the suggestions, we'll work on it right away.'"

* * *

[Rex]

23. Article on Kerkorian

http://www.detnews.com/2005/autosinsider/0504/29/B01-166053.htm

"Lawyers for billionaire Kirk Kerkorian and his company, Tracinda Corp., appealed a federal judge's ruling that he was not fooled into supporting the 1998 merger of Chrysler Corp. and Daimler Benz AG that created DaimlerChrysler AG.

Kerkorian, the former Chrysler Corp.'s biggest share holder, sued DaimlerChrysler and Chairman Juergen Schrempp, saying he was led to believe the combination of the German and American automakers would be a "merger of equals," but that it turned out to be a takeover."

This guy has legal problems with a huge GM rival so he buys stock in GM and appeals a court case against DaimlerChrysler.
Busy man.