Buffett backs Barra in General Motors board battle
<p><a href="http://www.cnbc.com/id/10000263?__source=yahoo|finance|inline|story|story&par=yahoo&doc=102468661"> Warren Buffett </a> could not be any clearer. </p><p> General Motors (NYSE: GM) CEO <a href="http://www.cnbc.com/id/101261456?__source=yahoo|finance|inline|story|story&par=yahoo&doc=102468661"> Mary Barra </a> is doing a good job leading the automaker, he told CNBC's <a href="http://www.cnbc.com/id/15838368?__source=yahoo|finance|inline|story|story&par=yahoo&doc=102468661"> "Squawk Box" </a> on Monday. He said it's also a bad idea for the its board to include a director who will be compensated by a group of hedge funds that own a stake in the automaker. </p><p> "I totally disagree with the idea of putting somebody on the board who has an option on some other people's stock which is only good for two years," Buffett told CNBC two days after sending out his annual letter to shareholders. </p><p> "To have somebody sitting there in the boardroom who has a two-year time horizon when they make money or it goes to zero after that is just not the way to run a business." </p><p> Read More<a href="http://www.cnbc.com/id/102414939?__source=yahoo|finance|inline|story|story&par=yahoo&doc=102468661"> Wilson to GM: 'Investors are frustrated' </a>
</p><p> Buffett's comments were aimed at Harry Wilson, the man who-as part of President Barack Obama's Auto Task Force-helped advise the administration about GM's bankruptcy, and how it should be organized as a new company. </p><p> </p><p> Last month, Wilson-who represents four investment funds that own 34 million GM shares-<a href="http://www.cnbc.com/id/102414939?__source=yahoo|finance|inline|story|story&par=yahoo&doc=102468661"> said he would nominate himself to the automaker's board </a>, with the goal of getting it to return a greater percentage of cash to investors. </p><p> Many were quick to question his motives. That's because Wilson has an agreement to be paid up to 4 percent of the gain in value of the shares owned by the funds he represents. But he was quick to defend himself following Buffett's comments, telling CNBC that his interest in GM is not purely short term. </p><p> "I led the restructuring in 2009 that gave GM a new lease on life and worked to rewrite the plan proposed by GM management at the time that, had it been approved, would NOT have resulted in the successes GM has experienced since 2009," Wilson wrote in an e-mail.
</p><p> "In other words, I have already demonstrated once that I can help GM build a business that is highly successful in the long-term, and our full proposal-which is MUCH broader than just the buyback-would help take it to the next level." </p><p> Read More<a href="http://www.cnbc.com/id/102445419?__source=yahoo|finance|inline|story|story&par=yahoo&doc=102468661"> Self-driving cars will kill some legendary auto brands </a>
</p><p> Wilson added that he would be willing to take all of his compensation in stock and have it tied up for an extended period of time, though he didn't elaborate on exactly how long. He ended his e-mail to CNBC suggesting he and Buffett are not far from seeing eye to eye on what's best for GM. </p><p> "I believe our perspectives are far more aligned than he realizes," Wilson wrote. </p><p> It remains to be seen if Wilson and Buffett can get on the same page. Wilson has said he would like to meet with the Berkshire Hathaway (NYSE: BRK.A) chief, but so far that hasn't happened. </p><p> According to an SEC filing last month, Berkshire Hathaway increased its position in GM during the fourth quarter, and now owns 41 million shares of the automaker. </p><p> Read More<a href="http://www.cnbc.com/id/102449995?__source=yahoo|finance|inline|story|story&par=yahoo&doc=102468661"> Buick-yes Buick-tops auto rankings </a>
</p><p> Buffett has been a vocal supporter of Barra, who like former CEO Dan Akerson has maintained that the new GM should have a "fortress balance sheet" with plenty of cash on hand to help it withstand the next downturn in the auto business. </p><p> "I think the idea of trying to do something that will get a pop in the stock should not be on her agenda or the shareholders' agenda," Buffett said. </p><p> GM recently said it plans to raise its dividend by 20 percent to 36 cents a share. </p><p> <em>Questions? Comments? BehindTheWheel@cnbc.com .</em>
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