A Chrysler Corp. spokesman says a Securities and Exchange Commission filing by company Chairman Lee Iacocca that allows him to sell up to 75 percent of his Chrysler stock is being "totally mischaracterized."
Company spokesman Steve Harris said Monday's filing of an S-3 form with the SEC was driven by commission guidelines, and discounted some reports speculating that Iacocca could be about to "cash out" of the financially beleagured No. 3 automaker. Chrysler is expected to report first-quarter losses of at least $200 million later this month."This is a simple registration and is being totally mischaracterized," Harris said. "All stock has to be registered by SEC law, and while we don't know what his intentions are, he has certainly not indicated to us any plans to do anything with these shares."
The S-3 filing shows Iacocca now controls just under 409,000 Chrysler shares and has options to buy an additional 2.5 million shares.
Specifically, Iacocca registered 315,000 shares under the filing. Of those, 191,000 shares were granted to him in November. The remainder has yet to be granted to him under terms of his contract, Harris said.
Chrysler's stock closed at $14.25 a share in trading on the New York Stock Exchange Monday. At that price, Iacocca's holdings would be valued at more than $5.8 million, while the 315,000 shares earmarked for possible sale would be worth just under $4.5 million.
According to the SEC filing, the 66 year-old Iacocca, who married for the third time Saturday, stated he may "from time to time" sell or give away the shares.
The SEC requires corporate insiders to disclose major changes in their holdings, and there is a six month holding period on stock before it can be disposed of.
Industry analysts said Iacocca may have made the filing to give him some financial flexibility.
"This may give him some flexibility if he wants to retire at the end of this year," said Thomas O'Grady, of Integrated Automotive Resources Inc., in Wayne, Pa. "It may be related to other things in his personal portfolio that would give him certain tax advantages."
"If he were actually selling big chunks of it this might be significant, but I have a hard time making something out of this, because relative to his overall position, 315,000 shares is not a lot," said David Healy, of New York investment firm Barclay's Bank.
Iacocca's contract calls for him to remain with Chrysler until the end of this year. But in a recent interview, he said he would remain until the worst of the carmaker's problems were over, as the firm struggles to cut costs to remain competitive into the 1990s.
Iacocca also said he would take a lesser managerial role with the company if its prospects were to brighten by early 1992.