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Hedge Fund Nominates Three GM Board Members
New York City-based Greenlight Capital Inc. says it has nominated three independents to the General Motors Co. board, presumably to push for splitting GM shares into two classes.
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New York City-based Greenlight Capital Inc. says it has nominated three independents to the General Motors Co. board, presumably to push for splitting GM shares into two classes.
The hedge fund is headed by David Einhorn (pictured). Last month he proposed that GM continues to offer conventional shares that pay a dividend but add a second class of stock aimed at investors that would distribute earnings to its holders. Einhorn estimates the two-class strategy, which GM dismisses as “unacceptably risky,” would hike GM’s $52 billion market capitalization by as much as $38 billion.
Greenlight complains that GM is misrepresenting its proposal to rating services. The fund wants permission to present its case directly to those agencies. GM says it has portrayed the fund’s idea “fully and fairly.”
Greenlight’s nominees are Leo Hindery Jr., managing partner of InterMedia Partners and former CEO of Tele-Communications, Liberty Media and AT&T Broadband; Vinit Sethi, Greenlight’s director of research; and William Thorndike, chairman of Consol Energy and managing director of private equity investor Housatonic Partners.
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