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Captain Kirk's final trek
Controversial US investor quits the car business after losing $US600 million on Ford
31 Dec 2008
BILLIONAIRE investor Kirk Kerkorian’s colourful association with the US auto industry appears to have come to an end with news that he has sold all of his remaining shares in Ford Motor Company.
The controversial 91 year-old Californian – rated by Forbes magazine as the 41st richest person in the world with a fortune of $US18 billion ($A26 billion) – is believed to have lost as much as $US600 million ($A860m) gambling on Ford.
Mr Kerkorian’s Tracinda Corporation started amassing Ford stock in April 2008 and quickly accumulated 141 million shares for a 6.5 per cent stake in the company.
However, Ford’s stock price dropped dramatically from $US7.07 a share when Tracinda bought in to $US2.43 when it started selling on October 21.
After Dow Jones reported two days ago that Mr Kerkorian had sold out completely, the price on Wall Street dropped further to $US2.17.
Mr Kerkorian made his fortune developing Las Vegas casinos and hotels, but for many years has had a tumultuous relationship with the auto industry.
In 1995 he made a failed hostile takeover bid on Chrysler with former chairman Lee Iococca and then turned his attentions to General Motors, where he tried to force a merger with Renault and Nissan in 2006. At that time he owned 9.9 per cent of GM, but then sold out.
After trying again to buy Chrysler from Daimler in early 2007, he turned to Ford as he is believed to have been an admirer of new CEO Alan Mulally.
Not surprisingly, Mr Kerkorian has now decided to walk away from the car business. According to a recent Tracinda statement, he is turning his attentions back to the gaming and hospitality industry as well as oil and gas.
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