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GM Board to Consider Kerkorian Suggestion
October 3, 2006
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From United Press International

DETROIT -- General Motors Corp. shareholder Kirk Kerkorian will ask the board to hire an independent firm to study an alliance with France's Renault SA.

Kerkorian's request, which will be discussed by the board Tuesday, stems from Kerkorian's frustration with GM Chief Executive Rick Wagoner's apparent lack of enthusiasm for an alliance with Renault, Automotive News reported.

Kerkorian, who owns a 9.9-percent stake in GM, last week said he may buy more shares. He proposed an alliance between GM and Nissan-Renault in July. GM agreed to enter into exploratory talks with Nissan-Renault for 90 days. Those talks are being led by management of all three companies.

Wagoner has often said that GM's first priority is focusing on its turnaround plan, not an alliance. GM lost $10.6 billion last year.

The source told Automotive News that the board could vote to hire the independent committee or give management more time to study the alliance.

The source said that board members favoring an independent committee will likely argue it is needed, in part, to protect GM from potential shareholder lawsuits for ignoring their fiduciary responsibility.

Copyright 2006 by United Press International