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Billionaire investor Kirk Kerkorian said he may up his stake in Ford beyond 5.5%, as he follows-through on his intention to purchase additional shares, Bloomberg News reported Friday.
Kerkorian, in a Friday SEC filing, reiterated that his Tracinda Corp. will pay $8.50 per share for 20 million additional shares of Ford (NYSE: F), which will give him a 5.5% stake, Bloomberg News reported. In the filing, Tracinda added that it may "from time to time, propose business strategies and, subsequent to the expiration of the offer, acquire additional shares."
Shares of Ford rose 5 cents to $8.25 in Friday morning trading on the news.
A gold star for Ford
Independent stock analyst C. Leonard Bauer told BloggingStocks Friday Kerkorian's stance is "a definite gold star" for Ford, concerning its turnaround program.
"Kerkorian's decision, because of his investment history and knowledge of the auto sector, will telegraph to other institutional investors that it's time to start moderately adding to your Ford position," Bauer said. "Don't misunderstand, this turnaround story is only about 30% complete, but at this stage you can make a good case for buying a modest share amount." Bauer added that he does not have a rating on Ford nor own the company's shares.
Ford installed former Boeing (NYSE: BA) executive Alan Mulally as part of an effort to re-vamp production and revise its fleet to compete in the global auto marketplace. Ford's legacy cost reduction efforts have gone well; fleet revision progress has been slower, many analysts agree.
Large headwinds
Further, in addition to the anemic-growth U.S. economy, Ford, like other U.S. automakers, must deal with the new, high-price gasoline era, which features gasoline above $3.40 per gallon in most regions of the United States. Oil Friday continued its seemingly relentless march higher, pushing through the $125 per barrel level for the first time in history.
Counter-intuitively, Bauer said the record-high gasoline prices may help Ford, in the long run.
"The high price does create a large amount of short-term pain for the company, but the reality of high gasoline prices, the permanence of oil above $100 per barrel, tells Ford it has to create many, higher-mileage vehicles," Bauer said. "Fuel efficiency has to be at the core of their manufacturing model. It tells Ford executives, if you build tanks [inefficient SUVs], you're done as a company. In that sense, $100 oil will lead to a stronger Ford, from a fleet standpoint."
Kerkorian senses Ford may have a better idea: May up 5.5% stake
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Reader Comments (Page 1 of 1)
1. We dont need cocky billionaires makiing troubles around at Wall Street. Ford could have been at 10 or higher by now if not for Kirk K blocking everything with his baloney 8.50 offer. What does Kirk K think he is?? a hero? he is a square!
Posted at 1:00PM on May 9th 2008 by gumbo koontz
2. I suspect that there are stocks on the way up but big shots are a bit stretched out so billionaires are asked to sit on those stocks untiil they sell out of other stocks and join billioinairres on those stocks . Then the John Q Public would be suckered into the rally later on... SEC is just a doghouse!!
Posted at 1:02PM on May 9th 2008 by gumbo koontz
3. It is financially impossible for the rich to stay rich indefinitely without constant fixes and favors from right people to keep things in rows. What goes up can come down. Rarely, did we see many rich go poor. They are not that smart enough to keep things up and up all the times. No such guys can do that.. Maybe few not all of the rich. There are dirty work and fixes and stuff to keep the rich afloat at great expenses to the masses...
Posted at 1:05PM on May 9th 2008 by gumbo koontz
4. the only reason Kirk K launch a tender offer is to avoid going to the normal trading to get his 20 million shares. Why? Had Kirk gone to the normal trading, Ford would zoom past 8.50 as he starts buying and he dont want to pay more than 8.50 so he went the tender offer in hope to buy shares cheap from nervous nellie suckers!! Kirk is trying to cheat the normal supply and demand mechainsm by going tender offer with seemingly attractive 8.50 offer . If he buy Ford through series of 10,000 shares frequently, Wall Street would notice and bid up Ford past 8.50 maybe to 12 orhigher. Kirk spoiled everything for Ford investors even through their mutual funds or directly. What is Kirk trying to do?? To mess around with maangement until UAW get what they want?? Kirk is just a trouble maker..
Posted at 1:14PM on May 9th 2008 by gumbo koontz
5. if Kirk is confident in Ford, any idiot would know that 8.50 is too low. Just ignore Kirk , he is just a waste of space!
Posted at 1:15PM on May 9th 2008 by gumbo koontz
6. 5-09-2008 @ 1:00PM
gumbo koontz said...
We dont need cocky billionaires makiing troubles around at Wall Street. Ford could have been at 10 or higher by now if not for Kirk K blocking everything with his baloney 8.50 offer. What does Kirk K think he is?? a hero? he is a square!
25-09-2008 @ 1:02PM
gumbo koontz said...
I suspect that there are stocks on the way up but big shots are a bit stretched out so billionaires are asked to sit on those stocks untiil they sell out of other stocks and join billioinairres on those stocks . Then the John Q Public would be suckered into the rally later on... SEC is just a doghouse!!
35-09-2008 @ 1:05PM
gumbo koontz said...
It is financially impossible for the rich to stay rich indefinitely without constant fixes and favors from right people to keep things in rows. What goes up can come down. Rarely, did we see many rich go poor. They are not that smart enough to keep things up and up all the times. No such guys can do that.. Maybe few not all of the rich. There are dirty work and fixes and stuff to keep the rich afloat at great expenses to the masses...
45-09-2008 @ 1:14PM
gumbo koontz said...
the only reason Kirk K launch a tender offer is to avoid going to the normal trading to get his 20 million shares. Why? Had Kirk gone to the normal trading, Ford would zoom past 8.50 as he starts buying and he dont want to pay more than 8.50 so he went the tender offer in hope to buy shares cheap from nervous nellie suckers!! Kirk is trying to cheat the normal supply and demand mechainsm by going tender offer with seemingly attractive 8.50 offer . If he buy Ford through series of 10,000 shares frequently, Wall Street would notice and bid up Ford past 8.50 maybe to 12 orhigher. Kirk spoiled everything for Ford investors even through their mutual funds or directly. What is Kirk trying to do?? To mess around with maangement until UAW get what they want?? Kirk is just a trouble maker..
55-09-2008 @ 1:15PM
gumbo koontz said...
if Kirk is confident in Ford, any idiot would know that 8.50 is too low. Just ignore Kirk , he is just a waste of space!
Posted at 1:42PM on May 9th 2008 by gumbo koontz
7. 5-09-2008 @ 1:00PM
gumbo koontz said...
We dont need cocky billionaires makiing troubles around at Wall Street. Ford could have been at 10 or higher by now if not for Kirk K blocking everything with his baloney 8.50 offer. What does Kirk K think he is?? a hero? he is a square!
25-09-2008 @ 1:02PM
gumbo koontz said...
I suspect that there are stocks on the way up but big shots are a bit stretched out so billionaires are asked to sit on those stocks untiil they sell out of other stocks and join billioinairres on those stocks . Then the John Q Public would be suckered into the rally later on... SEC is just a doghouse!!
35-09-2008 @ 1:05PM
gumbo koontz said...
It is financially impossible for the rich to stay rich indefinitely without constant fixes and favors from right people to keep things in rows. What goes up can come down. Rarely, did we see many rich go poor. They are not that smart enough to keep things up and up all the times. No such guys can do that.. Maybe few not all of the rich. There are dirty work and fixes and stuff to keep the rich afloat at great expenses to the masses...
45-09-2008 @ 1:14PM
gumbo koontz said...
the only reason Kirk K launch a tender offer is to avoid going to the normal trading to get his 20 million shares. Why? Had Kirk gone to the normal trading, Ford would zoom past 8.50 as he starts buying and he dont want to pay more than 8.50 so he went the tender offer in hope to buy shares cheap from nervous nellie suckers!! Kirk is trying to cheat the normal supply and demand mechainsm by going tender offer with seemingly attractive 8.50 offer . If he buy Ford through series of 10,000 shares frequently, Wall Street would notice and bid up Ford past 8.50 maybe to 12 orhigher. Kirk spoiled everything for Ford investors even through their mutual funds or directly. What is Kirk trying to do?? To mess around with maangement until UAW get what they want?? Kirk is just a trouble maker..
55-09-2008 @ 1:15PM
gumbo koontz said...
if Kirk is confident in Ford, any idiot would know that 8.50 is too low. Just ignore Kirk , he is just a waste of space!
Posted at 1:44PM on May 9th 2008 by gumbo koontz
8. stop talking!!!!!!
Posted at 1:44PM on May 9th 2008 by gumbo koontz
9. Stop talking!!!!!?????????????
Posted at 1:44PM on May 9th 2008 by gumbo koontz
10. Stop talking!!!!!! Bloomberg!
Posted at 1:45PM on May 9th 2008 by gumbo koontz
11. HOw shocking Ford earned this quarter! Everyone is shocked Kirk is excited and he is offering $8.50 as if it is the best price Ford will get/? oh sheesh1 We are shocked that Ford is still building cars !! shocking shocking shocking shockign shocking shocking!!!!!! !!!!! oh my oh myyy oh my moy!
Sell yoru shares to Kirk and make a killing at $8.50 oh do it hurry suckerS!!
Posted at 1:47PM on May 9th 2008 by gumbo koontz
12. Ford hit $40 before and Kirk is offering you $8.50 oh c mon!! you dont knwo that?? Well you are ignorant and blissful!
Posted at 1:49PM on May 9th 2008 by gumbo koontz
13. you better sell to Kirk for $8.50 before Ford sinks again.. shocking shocking shocking !!
Posted at 1:50PM on May 9th 2008 by gumbo koontz
14. GM and Ford claimed that SUVs are hghly profitable yet they gave thosuands in rebates to buyers before. The profits poofed! GM and Ford never made much on SUVs but gave too much to UAW workers. Investors got nothing but lousy low dividends historically. Now GM and Ford can only build low profit small cars. My question is will they still give rebates and pension money to UAW forever?? I seriously doubt that GM and Ford would ever be allowed to make a lot of profits and paying good dividends ever again. UAW though smaller is still a presence and will strike repeatedly and take all the money away from yo shareholders. If you buiy Ford and Gm stock , you would only buy UAW time.... GM and Ford are not a buy!! I own them but I want to tell you about the likely prospects anyway. I dont really care ... UAW got to understand that they are mostly to blame!!
Posted at 1:56PM on May 9th 2008 by gumbo koontz
15. I am sorry to say it, but if, and I say if Ford survives it will be a long haul. Someone else said it but the number one problem for Ford as with most industrials are the unions. Where else can a guy doing a $15/hour job make $50/hour plus benefits unless he works under a union with total control and confiscatory power over a company? You bauk at $15/hour? Well the world is a global market and the market sets that wage not me. And if the world sets the price at $15 and unions through mobster control confiscate a higher rate, the corporte live span is set on a ticking bomb to extinction. Naturally as the union kills the corporation, they blame management.
This is not to say that managements make all the right moves. Ford held on to SUVs far to long as the bread and butter. But in some whys how could you blame them. First, who can say no to $7,000 profit per unit. Secondly, with the unions sucking all life blood, you got to make hay while the sun shines. But, to survive a little longer they did error in not making a transition plan.
Bottomline is it is nearly impossible to undo the union mess. The carnage of the unions is all accross teh American landscape, very very few corporations survive to live with a union. The unions drive they under and or out of the country. Ford is hard pressed to convince teh unions that they are the problem, so no amount of product change over is likely to conterbalance the fundamental problem of overpaying for labor. And if FOrd and squeze another penny or two out of the industry the union will be ther with it's hands out to take that too.
$8.50? Take it. Maybe in five years Ford will hit $10 or $11. Take the $8.50 and buy a CD, or a consumer products company, or a Canadian Oil Trust.
Posted at 11:40AM on May 28th 2008 by Bob