Ref from 5.8.2007:
http://www.detnews.com/apps/pbcs.dll...705080373/1148
"... The Ford family today is a sprawling clan anchored by the 13 great-grandchildren of Henry Ford. Many family members don't live in Michigan and have never worked at the auto company.
They are intricately tied, however, by
the 70 million shares of so-called "Class B" Ford Motor stock that they collectively own -- shares that have a combined voting power of 40 percent of all outstanding Ford Motor stock.
Those shares have always been voted in unison, and the family is famous in corporate circles for standing together through any crisis. But with Ford Motor struggling amid falling sales and record losses, the vast wealth of the family is under unprecedented attack...."
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Ref:
http://www.reuters.com/article/marke...090324?sp=true
Lifting the Lid-Ford family in focus as car crisis deepens
Tue Mar 24, 2009
* Ford family control of automaker faces challenge again
* Proponents see Ford family as stabilizing influence
* Ford only Detroit automaker to shun bailout to date
By David Bailey
DETROIT, March 24 (Reuters) - Out of the Big Three remains the Big One.
Ford Motor Co (F.N) -- needing no U.S. bailout of the kind that has kept its Detroit rivals afloat -- remains the last independent American car company. That makes its founding family one of the last surviving dynasties of its kind.
It also adds an unexpected twist to a long-running debate over governance and control at Ford: Has the Ford family been good for investors, or just lucky?
The question is expected to go before shareholders again in May at Ford's annual meeting, in a nonbinding vote on whether to abolish the separate class of shares the family has used to control the automaker since it went public in 1956.
But Ford can point to its relative success in escaping the worst of the brutal downturn to bolster its long-held case that family control offers stability in a volatile industry.
"They have a very significant interest in the company," said Paul Lapides, director of the corporate governance center at Kennesaw State University. "Their wealth is very much in the company and it demands they pay a lot of attention."
Ford family members' Class B shares control 40 percent of the vote with just 3 percent of the stock.
FAMILY CONTROL A HINDRANCE?
Ford shareholders -- watching the stock lose 93 percent of its value in the last decade -- have pressed for change, saying the family influence may have led to the hiring of industry outsider Alan Mulally as chief executive officer, but did not prevent costly misdirections in the past decade.
"Unfortunately, they spent all this money over the last decade on Jaguar and Land Rover," said John Chevedden, a dissident shareholder in the campaign to end the family stock structure. "In part that is why they are where they are today."
"The family had influence during all of those years," he said in a telephone interview.
Chevedden supports an annual and largely symbolic challenge to the family voting structure that is expected to be on the agenda for the company's annual meeting this year as well.
"Dual-class stock companies like Ford take shareholder money but do not let shareholders have an equal voice," the proposed resolution states. "Without a voice, shareholders cannot hold management accountable."
The resolution took 27 percent of the vote in 2008, down slightly from 2007.
Family members have suffered along with other shareholders, losing their dividend and watching the value of Class B shares fall to $206 million from $2.4 billion a decade ago. They met with investment bankers two years ago, but held their shares.
"The Ford family has shown through its actions that the success of the company for the benefit of all shareholders has been the primary purpose of their involvement," Ford spokesman Mark Truby said.
OR LONG-TERM ASSET?
Ford has so far shunned the emergency government loans that have kept General Motors Corp (GM.N) and Chrysler LLC in operation. Ford's rivals have received $17.4 billion and seek up to $22 billion more.
That has allowed Ford investors to skirt the pain of government oversight. GM shareholders, by contrast, could be wiped out as new stock is issued to pay off creditors under terms dictated by the government.
Still, Ford shareholders face the risk of heavy dilution as it funds up to half of its $13.1 billion obligation to a healthcare trust for union retirees in stock, and issues equity to buy back debt.
Barclays Capital analyst Brian Johnson estimates the share count could more than double, rising to about 5.6 billion, from 2.3 billion with trust-related issuance through 2018.
Johnson said he remains negative on Ford equity though, with reduced sales and increased cash burn potentially leading to a Ford request for government aid.
Former Ford President Jim Padilla sees the family as a long-term steadying influence for the automaker.
"I have always felt that the active participation in the ownership structure with the Ford family has been a benefit," Padilla said in an interview. "I think there is a greater commitment to the company, to the community to the employees."
"I think it will continue to be so long as they can keep the structure they have today. And that is going to require that they remain independent, in my view," Padilla said.
Analysts generally see Ford management as headed in the right direction under Mulally with a wave of upcoming smaller vehicles after losses of $30 billion over three years.
"Ford has all the elements of a successful turnaround: compelling new products; strong leadership; and significant cost-cutting opportunities," UBS analyst Colin Langan said in a note to clients.
Executive Chairman Bill Ford gave Mulally his seat at the head of the company in 2006 after taking heat for a bad bet on European luxury brands and deep problems in the United States.
Lapides, who holds some Ford stock, believes the automaker is on the right track in large part because of Mulally.
"Did they make a better decision than the other companies because of the family?" he asked. "I think people can argue that, but I think they just really just made a good decision and things worked out. I don't think this is family magic here."
(Reporting by David Bailey; editing by Richard Chang)
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A more detailed explanation of the Class B shares and details is found here:
http://www.fordforums.com/f349/how-f...control-39452/
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Finally, for a very detailed and excellent article in the Detroit News last November 2008 about the FORD family's control and the family's huge personal losses to date, see this:
http://www.detnews.com/apps/pbcs.dll...11260382&imw=Y
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