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Kerkorian backs off expanding GM stake
By TIMES WIRES
Published October 7, 2006
WASHINGTON - Jerome York, a respected auto industry veteran and a key adviser to billionaire investor Kirk Kerkorian, resigned from the General Motors board on Friday, citing a board room environment unreceptive to extensive probing and "grave reservations" about GM's ability against Asian competitors. Kerkorian, meanwhile, signaled he would not acquire more stock in the world's biggest automaker after GM decided against pursuing an alliance with Renault and Nissan. He already controls 9.9 percent of GM shares and had recently indicated he was considering raising that stake to 12 percent. The twin developments, disclosed in a filing with the Securities and Exchange Commission, sent GM shares tumbling. General Motors Corp. shares dropped $2.08, or 6.3 percent, to close at $31.05 Friday on the New York Stock Exchange. The announcements also raised speculation about whether Kerkorian could start a proxy fight for control of the board. Some analysts said York's departure from the board gives Kerkorian more flexibility to pursue a number of options, which also could include additional investments in the company and a proxy fight.
[Last modified October 6, 2006, 23:41:56]
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