Ford Motor Co. received a vote of confidence Monday when billionaire investor Kirk Kerkorian's Tracinda Corp. purchased 20 million shares, or 1% of the company, for $8.50 a share for a total of $175 million. The purchase adds to Tracinda's 4.7% holding in Ford.
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For the Dearborn, Mich.-based automaker, the purchase is a sign that investors possibly are happy with the performance of the company's management. In Monday trading, the deal pushed Ford's 7.45% bonds due in 2031 up to 76 cents on the dollar to yield more than 10%, versus 73 cents on the dollar on April 24, the last significant trade, according to MarketAxess. Another good sign for Ford's turnaround is its surprise announcement last week of a profit of $100 million buoyed by strong earnings in Europe and South America as well as a restructuring that cut 4,200 U.S. jobs through buyouts. - Gerald Magpily
TheDeal.com: Tracinda to buy into Ford
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