United Auto Workers President Dennis Williams sits in an interesting position – the union indirectly has control over the biggest single chunk of General Motors shares.
This is why Williams, in an interview with Reuters, expressed his opinion on the investor group’s proposal for a GM strategy to lift shareholder value by acquiring back $8 billion of its stock. The union president believes the idea to be premature and also forecasts the amount would be too large to not have a negative impact on the company’s long-term business status. Recently, an investment holding led by Harry Wilson, a former member of the US government- appointed task force that helped GM restructure when it went bankrupt back in 2009, and another four hedge funds came up with the plant that would see the carmaker divest part of its $25 billion cash horde back to investors and shareholders. “I personally don’t have a problem with Harry, but that doesn’t mean I necessarily agreed with his total analysis of the company,” Williams commented for Reuters after having an “informative and frank” meeting with Harry Wilson.
After their meeting the UAW president seems to generally favor the idea of endorsing a smaller share repurchase. The union, via a retiree medical trust, has ownership of around 8.7% of General Motors shares. The so-called voluntary employees benefit association, or VEBA – which funds UAW retirees’ medical care- also has influence over other funds controlling GM shares as the latter are hired to manage the former’s investments.