Hedge fund manager David Einhorn is settling in for a ‘tough fight’ with GM (GM)

Greenlight Capital’s David Einhorn just laid out what’s going on with his activist move on General Motors.

Earlier this year, Einhorn announced he had increased his position in the car company.

The activist hedge fund investor proposed that GM create two classes of stock, and accused the company of misleading credit-rating agencies about the plan. He told Business Insider’s Linette Lopez earlier this month that rating agencies were getting the analysis of his plan wrong.

In a letter sent to investors April 25, Einhorn noted that his firm had “made more noise than usual (and more than we’d like) by making public our idea for General Motors Company.”

A copy of the letter was reviewed by Business Insider.

Einhorn wrote:

“We felt the need to press the issue as we believe there is a lot of value to unlock and the company did not fairly evaluate our idea … To poison our idea, management went so far as to misrepresent our proposal to the credit rating agencies, allowing them to claim that the company’s credit standing would be in jeopardy if it implemented our idea.”

He added:

“We know this is a tough fight. Fortunately the math is on our side (if GM does what we suggest, we believe the stock will go up a lot) and the ultimate decision will be made by our fellow shareholders. We believe others recognize that the stock is deeply undervalued and when shareholders grasp the math and the extent of GM’s behavior, they will vote with their wallets and for needed change at the Board level.”

Einhorn noted that the last time the firm went after a company in a public manner was with Apple in 2013.

Greenlight’s flagship fund delivered 1.3% net of fees in the first quarter, below the S&P 500 index return of 6.1%.

A spokesman for Greenlight declined to comment. GM did not immediately respond to a message seeking comment.

A spokesman for GM responded to a request for comment after the original publication of this article. In a statement, they said:

“Greenlight’s proposal to eliminate GM’s common dividend to fund a separate dividend on an unprecedented security creates unacceptable risks and is not in the best interest of GM shareholders. GM presented Greenlight’s dividend share idea to the ratings agencies fully and fairly. The ratings agencies public statements issued regarding the Greenlight proposal clearly indicate that they understood the idea in all its facets and that it would represent a credit negative if implemented. Any suggestion to the contrary is baseless and irresponsible.”

This article was updated on Tuesday, 4:24 pm EST to include a statement from GM.