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Cerberus to Buy 80 Percent of Chrysler

German-based DaimlerChrysler will sell almost all of money-losing Chrysler to a private equity firm for $7.4 billion, backing out of a troubled 1998 takeover aimed at creating a global automotive powerhouse, the Associated Press reports.
Eighty percent of Chrysler Group, burdened by high pension and health costs and declining market share in the United States, will be sold to Cerberus Capital Management, which is taking a huge risk by agreeing to take on billions of dollars in pension and retiree health care costs at Chrysler, AP said.
Chaired by former U.S. Treasury Secretary John W. Snow, Cerberus has steadily been building strength in the automobile business. It led a consortium that bought a majority stake last year in General Motors Acceptance Corp., the financial arm of GM, and plans to invest in ailing auto parts giant Delphi, AP said.

Posted by   at 10:18 AM to Companies | Permalink

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