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Kerkorian's GM offer comes up short
Financier gets only about two thirds of the shares he sought under his tender offer.
June 8, 2005: 11:19 AM EDT

NEW YORK (CNN/Money) - Financier Kirk Kerkorian got most but not all of the additional shares of General Motors Corp. he was looking to buy, boosting his stake in the world's largest automaker above 7 percent, his investment firm said Wednesday.

Tracinda Corp. said it received just under 19 million GM shares under the firm's $31 offer, which expired Tuesday. The stock closed Tuesday at $30.73, up 31 cents, after GM (Research) announced plans to cut 25,000 U.S. jobs by the end of 2008 as it struggles with its worst losses in a decade.

Tracinda's offer, announced last month, was for up to 28 million more GM shares, or an additional 5 percent of the troubled automaker. It said the shares tendered to it will raise its stake in the company to about 41 million shares, or 7.2 percent, from about 22 million shares, or 3.9 percent, previously.

Kerkorian announced his tender offer on May 4 -- news that helped lift GM shares 18 percent. Kerkorian had previously been a major investor in Chrysler Corp., being the automaker's largest individual shareholder when it was purchased by Daimler Benz to form DaimlerChrysler (Research).

His May 4 announcement said he had spent an average of $26.33 a share for his initial stake in GM, which was near the 12-year low the stock hit in April. He said at that time that he was buying shares "solely for investment purposes."

According to data from shareholder tracking firm LionShares, Kerkorian is poised to become the No. 3 shareholder in GM, behind State Street Corp., with a 17.6 percent stake, and Capital Research and Management Co., which has 14.7 percent of the stock. It moves him just ahead of Southeastern Asset Management, which has 40.5 million shares in the latest report.

GM spokeswoman Toni Simonetti had little comment on Tracinda's statement other than to say that the automaker was aware of it and that it appeared the tender offer was undersubscribed.

For more on GM's plans to cut costs and jobs, click here.

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