Billionaire investor Kirk Kerkorian will move ahead with his tender offer for Ford Motor Co (F.N: Quote, Profile, Research) shares despite a recent slump in the No. 2 U.S. automaker’s stock, pushing shares up as much as 3 percent, Reuters reports.
Kerkorian’s Tracinda Corp said it would continue to tender for 20 million Ford shares at $8.50 each, despite an 18 percent decline since it launched the offer on May 9, a selloff triggered by Ford’s recent outlook cut.
Tracinda waived a condition that the market price of Ford not fall by 10 percent or more from the close of trading on May 8, a previously established escape that would have allowed Kerkorian to back out from his offer.
Tracindia disclosed last month it bought 100 million shares of Ford at an average price of $6.91 and planned to buy an additional 20 million shares, which would raise his stake to about 5.5 percent.
Shares of Ford rose as much as 20 cents to $6.91 shortly after the opening bell on the New York Stock Exchange. They have since erased most of those gains.
Kerkorian’s commitment to the tender offer could support the stock price and help protect his existing investment in Ford to a certain extent, analysts said.