BREAKING NEWSGM: For Sale By Owner?DETROIT (June 30, 2006) - Early this morning, a number of news services - including the Wall Street Journal (WSJ), Bloomberg, London Times, Reuters and Associated Press - have reported that French-based Renault SA and Japanese-based Nissan Motor Co. Ltd. are interested in acquiring a significant minority stake in General Motors Corp. (GM). Renault already owns 44 percent of Nissan, and the two foreign automakers work within a strategic alliance. The news services state that Renault and Nissan made the approach through Tracinda Corp., an investment company owned by billionaire Kirk Kerkorian - who owns just under 10 percent of GM, and is GM's largest single shareholder with 56 million shares. The WSJ, Bloomberg and other services reported that Tracinda Corp. sent a letter to GM CEO Rick Wagoner and also attached the letter in a Form 13-D filing today by Tracinda Corp. to the Securities Exchange Commission (SEC), per SEC regulations, as governed by the Securities Exchange Act of 1934. SEC Rule 13d-1 requires that anyone who acquires, directly or indirectly, and holds more than five percent of the shares of a company must submit details of all transaction to the SEC, using Form 13-D, within 10 days of any such transaction. The London Times reported that the letter from Tracinda Corp. urged GM's board to form a committee to "immediately and fully explore this opportunity together with management," noting that an alliance could help GM "realize substantial synergies and cost savings and thereby greatly benefit the company and enhance shareholder value." The WSJ and Bloomberg said that Kerkorian wrote, "It is our [Tracinda Corp.'s] understanding that Renault S.A. and Nissan Motor Co. are receptive to the concept of including General Motors in their partnership-alliance and purchasing from General Motors a significant minority interest in the company." Upon the opening of the markets today, Bloomberg reported that GM shares surged upward more than 10 percent on the breaking of the news. In a press release from GM issued soon after, the automaker stated, "General Motors Corp. has received no offer or proposal from Renault/Nissan with respect to its participating in the Renault/Nissan Alliance, as suggested in the 13-D Filing made today by the Tracinda Corp. The Tracinda request will be taken under advisement by the GM board of directors. At this time, we have no further comment." In other words, GM says it wasn't approached directly by Renault/Nissan, but the message was received and is being considered.
(Source: GM, WSJ,
London Times,
Bloomberg, SEC) 
