Kirk Kerkorian Getting Desperate to Keep GM From Being Gobbled Up by Toyota
Toyota Motor Corp. is breathing down GM’s neck. And Kirk Kerkorian, GM’s biggest stock holder is feeling the heat.
Multi-billionaire Kerkorian holds a 9.9% stake in GM that is worth $2.25 billion. Now he wants to invest another $400 million so that GM will have enough funds to make a deal with Renault-Nissan.
The last offer GM made to Renault-Nissan was that they (GM) would let Renault-Nissan buy into a partnership. "I’ll let you do business with me if you pay me."
Kerkorian, no doubt, has a different take. Since purchasing 56 million shares a while back, he has seen that investment grow by $84 million. To put that in perspective, if you have $5000 in the bank, it is the equivalent of making $84 on your deposit.
However, should GM partner up with the likes of Renault-Nissan, the stock prices are likely to jump, if only for a short time before Toyota eventually gobbles up the whole trio.
But, should GM sit tight and succumb to Toyota in the next year or so, Kerkorian’s stocks are likely to see a huge loss.
I think Kerkorian is getting desperate, well, as desperate as a billionaire can get, to keep his investment on top for as long as he can. Investing another $400 million, he stands to make a lot more.
What do you think?
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November 1, 2006
As it seems very much likely that Toyota will outpower GM for being the world’s number one automaker soon, Kerkorian has every reason to get frightened. The tie up with Ranault-Nissan is a nice option but that doesn’t seem to be sufficient enough to make GM step higher in the competition.
November 17, 2006
If you think toyota is a threat, look at
china, there the ones who are going to be the big players in the future!