Kerkorian Tries To Shake Up Chrysler Board Of Directors

Kirk Kerkorian, Chrysler Corp.’s largest shareholder, said Monday he will try to oust a company director and replace him with Kerkorian lieutenant Jerome B. York, a former Chrysler executive.

Kerkorian has been pushing the board for nearly a year to take steps he believes will increase Chrysler’s shareholder value. In April he launched an abortive attempt to take over the company.

A meeting Monday between Kerkorian and Chrysler Chairman Robert J. Eaton apparently did not satisfy the billionaire from Las Vegas.

In a statement after the meeting, Kerkorian’s Tracinda Corp. said it will file documents with the Securities and Exchange Commission to solicit shareholder support to unseat former Kmart Corp. Chairman Joseph Antonini from the Chrysler board at the company’s annual meeting next spring.

“In order to communicate our views directly to other Chrysler shareholders, it is required that we make appropriate filings with the Securities and Exchange Commission, since the Chrysler board does not include a person affiliated with Tracinda,” the statement said.

Antonini could not be reached for comment Monday.

Kerkorian owns or controls more than 14 percent of Chrysler’s stock. The proxy solicitation involves asking other shareholders to sign over the voting rights of their stock. Corporate directors are elected by shareholders, with each share of stock representing one vote.

A letter to Eaton from York, included in the statement Monday, said Tracinda would not solicit other shareholders’ proxies during the next 2-1/2 months, but that it might after that.

Kerkorian proposed in October that York be given a board seat and that Tracinda be given veto power over two other seats. He also asked the Chrysler’s anti-takeover defenses be relaxed.

On Nov. 2, Chrysler said its board would start a 90-day review of the company’s governance policies and evaluate Kerkorian’s proposals as part of that.

“The process will continue, notwithstanding the actions announced today by Kirk Kerkorian and his representatives,” Chrysler said in a statement Monday evening. “The process will enable the board to act in the best interests of all shareholders.”

Antonini, who was forced out of the top job at Kmart earlier this year, has been a member of the Chrysler board since 1989.