May 9 (Bloomberg) -- Billionaire investor Kirk Kerkorian said he may boost his Ford Motor Co. stake above 5.5 percent and provide cash for the automaker's revival, signaling increased confidence in Chief Executive OfficerAlan Mulally.

Kerkorian's Tracinda Corp. made the disclosures today as it followed through with a plan to offer $170 million for an additional 20 million shares. Kerkorian, 90, also said he bid last year to buy Ford's Jaguar and Land Rover and that he has been asked by Chairman William Clay Ford Jr. to discuss his stake. Ford's board is reviewing Kerkorian's tender offer.

``To have a guy buy in worth a couple billion dollars, who is very familiar with the auto industry, I don't see how you take that in any way except a huge positive,'' said Bernie McGinn, president of McGinn Investment Management Inc. in Alexandria, Virginia, which owns 300,000 Ford shares.

The announcement, in a U.S. filing, indicates Kerkorian's deepening involvement in Ford since he revealed his stake 10 days ago. His adviser Jerry York initially labeled the purchase as ``purely for investment purposes'' and an endorsement of Mulally's efforts to restore the Dearborn, Michigan-based automaker to profit following a combined $15.3 billion of losses in 2006 and 2007.

Ford fell 10 cents to $8.10 at 4:02 p.m. in New York Stock Exchange composite trading.

Take No Action

In a statement on its Web site, Ford urged shareholders take no action on the Tracinda offer pending the board review. Ford will tell shareholders of the board's position by May 22, more than two weeks before the solicitation expires June 9.

The company said in a follow-up e-mail that executives were ``completely unaware'' of Tracinda's investment until the weekend of April 26 and 27.

``We have explored the possible infusion of additional capital into Ford in order to give it more flexibility in implementing its turnaround process,'' Tracinda said in the filing, without providing details.

Today's tender offer, announced in a U.S. filing, reiterates that Tracinda will pay $8.50 for each of 20 million additional shares, giving him 5.5 percent of the company. Tracinda began buying Ford stock on April 2 and said April 28 it had spent $691 million to acquire 100 million shares, for a 4.6 percent stake.

Tracinda may ``from time to time, propose business strategies and, subsequent to the expiration of the offer, acquire additional shares,'' the filing said.

``We are making the offer because we believe Ford is an attractive investment. We do not have a present intent to acquire or influence control over the business of Ford.''

Percentage Changes

Las Vegas-based Tracinda originally estimated its stake after the tender offer at 5.6 percent and today said it will be closer to 5.5 percent. The company also originally estimated its 100 million shares as 4.7 percent and today said it was closer to 4.6 percent.

``We welcome Tracinda and thank them for their confidence in our plan,'' Bill Ford said at the company's annual shareholder meeting yesterday.

The Ford family controls 40 percent of voting power at Ford through 70.9 million Class B shares. Bill Ford is one of two family members on the automaker's board.

Beginnings

Bill Ford contacted Tracinda attorney Terry Christensen on May 6 about the prospect of future meetings, Tracinda said in the filing. Tracinda also said it has looked at additional transactions.

Tracinda also said today that York first met with Mulally on April 4 to express interest in investing in the automaker and informed Chief Financial Officer Don Leclair on April 27 that the group had accumulated 100 million shares.

Ford said in today's e-mail from spokesman Mark Truby that York on April 4 ``made what we thought was an off-the-cuff remark that Tracinda might be interested in investing in Ford.'' The company said any additional comment will be included in a formal response to Tracinda's offer.

Ford's 7.45 percent note due July 2031 fell 1.3 cents to 73.69 cents on the dollar, yielding 10.49 percent, according to Trace, the bond-price reporting system of the Financial Regulatory Agency.

Credit-default swaps on Ford debt gained 25 basis points to 908 basis points today, according to CMA Datavision in London. The contracts are designed to protect bondholders against default. A rise in the price indicates a decline in the perception of a company's credit quality.

Auto History

Kerkorian has periodically invested in U.S. automakers, including an unsuccessful bid in 1995 to take over Chrysler Corp.

In May 2005, he disclosed an initial stake in General Motors Corp. and became the largest individual shareholder with 9.9 percent. He helped put York, 69, on the GM's board, where he pushed to have the Detroit automaker link up with Nissan Motor Co. and Renault SA. York ultimately resigned after the tie-up was rejected and Kerkorian sold off his remaining stake.

Kerkorian invested in Chrysler dating back to 1990, when he acquired 22 million shares in the Auburn Hills, Michigan-based automaker. He pressured the company to add a Tracinda employee to the board and ultimately offered $21 billion to buy the whole company. Kerkorian was assisted by York, Chrysler's chief financial officer from 1990 to 1993.

Jaguar Bid

Tracinda also disclosed it made an unsuccessful offer to buy Ford's Jaguar and Land Rover brands in July. Ford agreed in March to sell those brands to Tata Motors Ltd. for $2.3 billion.

Ford cut 46,300 jobs in North America in the past two years, and 4,200 more U.S. factory workers have agreed to leave in 2008 through buyouts. Since Mulally, 62, took over as CEO from Bill Ford in September 2006, the former Boeing Co. executive has worked to stabilize the company's U.S. market share and foster collaboration among regional units.

The automaker reported a first-quarter profit of $100 million, defying analysts' projections for a loss. The company still forecasts a loss for 2008 while maintaining a goal of becoming profitable next year.

Ford is struggling with declining U.S. sales of sport- utility vehicles and large pickup trucks, its main source of profits in the 1990s. Consumers are buying fewer of those models as the average U.S. gasoline price approaches $4 a gallon.

To contact the reporters on this story: Bill Koenig in Southfield, Michigan at wkoenig@bloomberg.net; Jeff Green in Southfield, Michigan at jgreen16@bloomberg.net.

Last Updated: May 9, 2008 17:04 EDT