Billionaire investor and Las Vegas casino mogul Kirk Kerkorian has made an $870 million offer to become one of the largest shareholders...

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DETROIT — Billionaire investor and Las Vegas casino mogul Kirk Kerkorian has made an $870 million offer to become one of the largest shareholders of General Motors, a move that boosted GM’s previously plunging stock price and quickly caused a flurry of speculation about Kerkorian’s motives.

Kerkorian, an aggressive investor, once tried to take over Chrysler and was its largest shareholder before German automaker Daimler-Benz bought it.

He would quickly become GM’s third-largest shareholder and could exercise enormous influence.

Kerkorian’s personal investment fund quietly bought up 3.9 percent of GM’s shares in late April. His latest effort, an attempt to buy as many as 28 million shares of GM stock at $31 each, would boost his stake to 8.84 percent of GM.

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His stake was below the 5 percent level that requires public disclosure, so not even GM knew he had bought millions of shares last month.

The reclusive billionaire’s sudden interest in GM is notable because of his track record, from making a very public but failed effort to take over Chrysler in 1995, to selling off huge chunks of MGM’s valued film library, to suing DaimlerChrysler for $1 billion for allegedly misleading him in the 1998 merger deal.

Kirk Kerkorian

Investor and owner of Tracinda, which holds a majority stake in the casino and hotel operator MGM Mirage. Tracinda was the largest shareholder in Chrysler when the automaker merged with DaimlerBenz in 1998.

Age: 87.

Net worth: An estimated $8.9 billion, according to Forbes magazine.

Career: Officer of MGM studios beginning in 1973; airline owner and operator, 1947-69; British Royal Air Force Transport Command, captain, 1942-44.

Source: The Associated Press

Kerkorian’s personal investment firm, Tracinda, said the proposed purchase was for “investment purposes” only. It said it made the announcement yesterday because of rumors.

Kerkorian confidant Terry Christensen said the move was “a sign of faith in the company,” at a time many on Wall Street have fled GM.

Tracinda contacted GM yesterday to let the automaker know of its interest.

News of Kerkorian’s offer boosted GM shares 18 percent, or $5.03, yesterday as investors followed the lead of a man whose wealth Forbes magazine pegs at $8.9 billion.

“Any time you have someone like him, who gets down and dirty in the details and seems to know the auto industry, well, everyone decides to take a second look at GM,” said Daman Blakeney, an auto analyst with Victory Capital Management, which manages about $45 billion in assets. It does not own shares in GM.

“Everyone has kind of left GM for dead and when he gets in, everyone says ‘Whoa, what did we miss?’ It definitely makes you re-examine your reasons for staying away from GM,” Blakeney said.

Yesterday was the biggest one-day jump in GM stock in more than two decades, as more than 60 million shares were traded, six times the stock’s normal volume.

Kirk Kerkorian once made bid for Chrysler

As a result, the total value of GM stock jumped yesterday from $15.7 billion to $18.5 billion.

The shares finished the day at $32.80, the highest they’ve been since a mid-March profit warning, an announcement that began an ugly month-and-a-half stretch of bad news for the automaker.

In recent weeks, GM stock had fallen to levels not seen in a decade, much of that because the automaker has refused to give Wall Street financial guidance for the rest of the year, citing a “health-care cost crisis.”

GM had little to say about Kerkorian’s announcement. “GM typically does not express a view on specific investor activity. GM’s board and management are committed to enhancing shareholder value for all of our investors,” a company statement said.

Kerkorian’s history with Chrysler and MGM left experts in the automotive and financial communities trying to guess what Kerkorian would try to do with GM, which just two weeks ago announced its worst financial quarter in more than a decade.

Some had him trying to force GM to sell parts of its profitable GMAC money-lending business.

“Our expectation is that the Tracinda/GM story will take many twists and turns over many quarters,” analyst John Casesa told clients at brokerage Merrill Lynch. Casesa, who said in a note he expects a “long, drawn-out battle,” raised his rating on GM from “sell” to “neutral,” citing Kerkorian’s interest in the beleaguered automaker.

“There is no doubt in our mind that Tracinda’s interest is not in the auto business, but rather in unlocking value embedded in non-core businesses, including GMAC’s non-auto subsidiaries,” Casesa said.

GMAC, which has long generated the bulk of GM’s profits, has both a mortgage business and an insurance business within it. Casesa and others speculated Kerkorian would push GM to sell off those businesses, moves that have been speculated about for some time anyway.