GM Is Said to Plan Talks on an Alliance

General Motors Corp. Chief Executive Rick Wagoner plans to meet with Carlos Ghosn, his counterpart at Renault and Nissan Motor Co., next week to discuss a possible alliance, according to a GM executive who was briefed on the schedule.

The July 14 meeting was set up independently from a regular GM board session set for Friday, during which directors will address shareholder Kirk Kerkorian’s proposal that Renault and Nissan extend their own alliance by investing in GM, said the person, who asked not to be identified because the schedule was not being made public.

On Monday the boards of Renault of France and Nissan of Japan gave Ghosn permission to discuss the matter with GM, on the condition that the U.S. automaker would welcome talks.

French Finance Minister Thierry Breton said Wednesday that the government backed the decision by Renault directors to hold alliance talks with Detroit-based GM. The French government holds a 15% stake in Renault, and Renault owns a controlling 44% of Nissan.

The proposal comes as Wagoner, 53, wraps up several initiatives aimed at restoring profit at the world’s largest automaker. He is cutting 30,000 union jobs, closing plants and trying to win back buyers with new models after GM posted a $10.6-billion loss last year.

Kerkorian proposed the alliance in a filing Friday. He said that his Beverly Hills-based Tracinda Corp., an investment vehicle, had discussed the proposal with the French and Japanese automakers and that they were receptive.

The 89-year-old billionaire investor, who owns 9.9% of GM’s shares through Tracinda, has lost confidence with the pace of Wagoner’s plan, according to a person familiar with Tracinda’s strategy.

Kerkorian wants a GM alliance with Renault and Nissan, or a faster alternative to Wagoner’s current four-point plan to return to profitability through cost cuts and new models, said the person. The investor launched an unsuccessful bid to buy Chrysler Corp. 11 years ago.

Representatives of GM, Renault and Nissan all declined to comment on a Wagoner-Ghosn meeting, first reported by the Detroit News on Tuesday.

Tracinda’s letter to Wagoner on Friday said Renault and Nissan were receptive to buying “a significant minority interest” in GM. People familiar with the talks said the automakers might buy a combined 20% stake.

In a separate letter to Renault and Nissan, Tracinda said the idea had been discussed with Ghosn, 52, who has led Nissan to six straight years of record earnings. He became Renault’s CEO in April 2005.

Kerkorian, his advisor Jerome York and Ghosn discussed Renault’s and Nissan’s each acquiring about a 10% stake in GM over dinner about two weeks ago at a restaurant in Nashville, a person familiar with the meeting said.

York, also a GM board member, later told Wagoner about the dinner and Ghosn’s possible interest, the person said.

Since Kerkorian disclosed his initial GM stake of 8.8% on May 4, 2005, the automaker’s shares have declined 10%. Nissan shares have risen 20% in the same period and Renault’s by 23%.

The GM board meeting this week will be conducted by a conference call with directors, according to people familiar with the schedule.

Shares of GM rose a penny Wednesday to $29.42. They have gained 7.2% this month and 51% this year.