Chrysler Sold for $7.45 Billion
This may go down in history as one of the worst investments of all time, or one of the best. The way things look right now, I’d lean towards the latter. Daimler-Benz paid $36 billion for Chrysler in the “merger of equals” / takeover way back in 1998. So, 8 years later, Chrysler is worth just 19% of it’s former value. This doesn’t even take into account the investments that Daimler-Benz made into Chrysler, which by some accounts, total a whopping $70 billion. So, you pay $70 billion to get $7.45 billion - good deal.
Anyway, on to the big news. Cerebus Capital Management is the company with brass balls, who decided to take the plunge and by up Chrysler. Daimler ( Now Daimler AG ) will hang on to 19.9% of Chrysler, now called Chrysler Holding LLC. The $7.45 billion purchase is strange, I have to say. $5 billion gets sent to Chrysler’s automotive sector, and $1.05 billion goes to financial services. So Daimler really doesn’t get much at all when you get right down to it.
Chrysler Holding LLC will start out fresh, with no debt, but still with their massive healthcare and pension liabilities. And, of course, they have that whole “negative cash flow” problem going on over there. And that’s also ignoring the fact that they have no good products on the market, except for perhaps the Jeep lineup.
Has anyone noticed that the only three cars in the Chrysler & Dodge lineup that people actually buy are built on Mercedes platforms? Yes sir, that’s the Chrysler 300, Dodge Charger, and Dodge Magnum. Any chance Daimler will help design the new platforms when these are up for a redesign?
THIS IS WHAT I THOUGHT WAS INTRESTING, DODGE SEEM TO HAVE GOOD RELATIONS WITH MITSUBISHI AND NOW MERCEDES IS CONNECTED TO CHRYSLER WHICH IS RELATED TO DODGE. SO, A GERMAN/AMERICAN/JAPANESE COMPANY ALLIANCE? WIERD HUH?
I hope Cerberus fares better than Daimler did….
SERIOUSLY THOSE CROWN VICTORIAS ARE. PLAIN, BASIC, GENERIC, AND OVER USED BY THE POLICE. I THINK IT WILL HURT FORD’S POCKET BOOK JUST A LITTLE. DON’T YOU THINK SO?