Daimler Values Chrysler Stake at Zilch. Nothing. $0

Robert Farago
by Robert Farago
daimler values chrysler stake at zilch nothing 0

You may recall that Daimler maintained a minority share of Chrysler when it sold the American automaker to Cerberus. About a year ago, ChryCo’s German “partner” (and author of the abortive DaimlerChrysler “merger of equals”) valued its 19.9 percent Chrysler stake at $2.2b. At the end of June, the number slid to a scarecely creditable $268m. And now The Detroit Free Press says Daimler believes that its ChyrCo position is without any financial value whatsoever. Which should make Cerberus’ negotiating position re: buying back that stake so it can “sell” the whole kit and caboodle to GM, or just C7 Chrysler, a little easier. But in fact, it’s important to note that Chrysler has long-term liabilities to its unionized workforce, and lots of ‘um. Billions of dollars worth. If/when Chrysler goes Tango Uniform, you can bet the United Auto Workers, jilted suppliers and other debtors will come knocking on Daimler’s door. So I’m thinking Daimler may have to pay Cerberus to rid themselves of this troublesome man. Watch this space.

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  • NetGenHoon NetGenHoon on Oct 24, 2008

    Adub: I agree! Robert Farago for President! (of Chrysler)

  • Tom Tom on Oct 24, 2008

    A TTAC owned automaker would be interesting...and this seems like a good moment to do it, since the automaker costs less than any car produced by the same company. When Daimler's 20% stake is worth zero, then Cerberus 80% stake is worth four times zero, so the entire company's value comes in at...zero. Just give them a symbolic Dollar and go C11 with Chrysler.

  • Mikeolan Mikeolan on Oct 25, 2008

    Great job Daimler! All it took was 10 years of you sucking Chrysler dry and shaking America's most innovative car company of all its talent!

  • Hal Hal on Oct 25, 2008

    "America's most innovative car company" Is that like the tallest mountain in Kansas? Daimler already paid Cerberus to take Chrysler off their hands. I'm sure a corporate lawyer could explain the significance of Daimler retaining a 19.9% stake rather than a 20.1% stake but I doubt very much they have any further exposure to Chrysler.