Ford Divests Stake in PeoplePC

Ford Motor Co. sold a 5.2% stake in PeoplePC Inc. after the world’s second-largest auto maker canceled its personal computer giveaway program for employees to reduce costs.

Ford owned 3.22 million PeoplePC shares and had a warrant to buy an additional 2.86 million at $10 each until July 16, 2003, PeoplePC said in a filing with the Securities and Exchange Commission. The stake equaled 5.2% of PeoplePC as of Dec. 31, PeoplePC said. The stake was worth $611,772, based on the shares rising 2 cents to 19 cents on Nasdaq.

The auto maker had distributed about 166,000 personal computers and printers to employees through San Francisco-based PeoplePC from February 2000 until the end of May 2001, when the program was deferred until the fourth quarter. Ford then canceled the program in October as sales fell.

Ford shares fell 44 cents to $15.86 on the NYSE. PeoplePC shares were priced at $10 each in an initial public offering in August 2000.