Daimler Wants to Dump Last of Chrysler on Cerberus

Robert Farago
by Robert Farago
daimler wants to dump last of chrysler on cerberus

Automotive News has sent an alert to its subs, and it’s not just because the autoblogsphere needs more lerts (submarine joke deleted). The publication reports the official announcement: “Daimler confirms that the company is in discussions with Cerberus Capital Management regarding the redemption of its remaining 19.9 [percent ownership of Chrysler].” Redemption? I don’t think so. Anyway, what’s up with that? Well, here’s a clue: nobody’s talking about price. Riddle me this Moustache Man: if ChryCo goes down the chute marked Chapter 11, could creditors go after the still-solvent Daimler? Uh-huh. So, just as Cerberus used OPM (Other People’s Money) to finance their original purchase of the soon-to-be-ailing American automaker, it’s entirely possible that Daimler’s paying them to take Chrysler off their hands. So why would Cerberus want that 19.9 back? It would be a lot easier to ask for an undisguised federal bailout with ChryCo as 100 percernt ‘Merican. Now matter how the deal goes down, if down it goes, it’s back to” The Big Three” ’round here. Only Honda’s bigger than Ford and Chrysler now. Oh dear.

Join the conversation
4 of 9 comments
  • Geotpf Geotpf on Sep 24, 2008

    Domestic Hearse-Good point, but wouldn't Chrysler's LLC status protect Daimler as well?

  • Domestic Hearse Domestic Hearse on Sep 24, 2008

    I believe it would. Again, I must defer to Justin and his background in law to properly sort out the technicalities of an LLC... Justin? How's it work?

  • Indi500fan Indi500fan on Sep 24, 2008

    "How can Chrysler go into Chapter 11 without taking all of Cerberus with it?" That's what all those high priced attorneys DO all day.

  • Blindfaith Blindfaith on Sep 24, 2008

    All of the car manufacturer’s formerly known as the “Big 3″ are mere shadows of themselves and their outdated and outmoded business models. Could somebody describe the Big 3 business model? Could somebody write an improved model for them? Maybe one of them could read it and understand what to do to make it work. Please do not title it " The Three Stooges"