Kirk Kerkorian Sells Ford Shares

by Robert Farago

October 21st, 2008 9:47 AM

Automotive News [sub] reports that billionaire investor Kirk Kerkorian has sold part of his 6.5 percent stake in Ford Motor Co. and could sell the rest before this blog hits the net. This according to spokesfolk for Kerkorian’s investment “vehicle” Tracinda Corp. “Tracinda, which has invested about $1 billion in Ford, said in regulatory filings it sold 7.3 million Ford shares on Monday in the open market for an average price of $2.43 per share. Tracinda intends to further reduce its holdings, including the possible sale of all of its remaining 133.5 million shares, or about a 6.09 percent stake, depending on market conditions and available sales prices.” Hang on; is this the same Captain Kirk who offered a cash infusion to FoMoCo in June? The same Lion of Las Vegas who, according to last Friday’s Bloomberg report, “pledged another 50 million MGM shares to back the $600 million Bank of America Corp. credit line he used to buy into the second-largest U.S. automaker?” Yup. There’s at least one analyst and an investor with a massive egg on their respective faces…

The pledging of additional MGM shares “indicates Tracinda’s desire to hold on to its Ford investment in the face of a potential margin call,” said analyst Brian Johnson at Barclays Capital in Chicago, before the weekend. “I would be concerned if he got out.” Bernie McGinn, of McGinn Investment Management in Alexandria, Virginia (which owns some 325k Ford shares) previously pronounced. ‘I’m hoping to see Kerkorian not flush his Ford position. It’s a continued vote of confidence.'”

Does this mean KK thinks Ford’s doomed? “Tracinda Corporation… sees unique value in the gaming and hospitality and oil and gas industries and has, therefore, decided to reallocate its resources and to focus on those industries.” So, yes.

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2 of 13 comments

Rpol35 on Oct 21, 2008

This jacka$$ needs to see Warren Buffet for "Investments 101", you're supposed to buy low & sell high, not buy low and sell lower!

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on Oct 21, 2008

Smart man (but stupid to buy them in the first place). Ford is a sinking ship...it is only a matter of time before they are fully underwater.

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