GM to Remain Neutral on Kerkorian’s Tender Offer

General Motors Corp., the world’s largest automaker, said Thursday that it would remain neutral on investor Kirk Kerkorian’s tender offer for as many as 28 million GM shares to bring his stake in the company to 8.8%.

GM’s board unanimously voted at a special meeting not to express an opinion, urging each shareholder to “make its own decision,” the automaker said in a regulatory filing.

Tracinda Corp., Kerkorian’s Los Angeles-based company, said May 4 that it was offering $31 a share to bring what it called a “passive” stake in GM to 50 million shares.

“From a tactical standpoint, it makes sense not to take a position,” said Burnham Securities Inc. analyst David Healy. “But it’s kind of Pollyanna, looking at it through rose-colored glasses. Kerkorian is trying to stir up the pot, and there’s no way this is a passive investment.”

The offer comes as GM Chief Executive Rick Wagoner tries to return the company’s automotive operations to profit after a $1.1-billion first-quarter loss, GM’s biggest in 13 years. A day after Kerkorian’s announcement, Standard & Poor’s cut its rating on $196 billion of GM debt to non-investment grade, in part because of falling sport utility vehicle sales.

Tracinda’s offer will expire June 7 unless extended. GM shares rose $1.14 to $32.75 on the New York Stock Exchange on Thursday. The filing was released after the market closed. The shares gained 6 cents in after-hours trading.

If completed, the purchases will make Kerkorian GM’s third-biggest shareholder.