DaimlerChrysler AG is expected to narrow the list of bidders for Chrysler to one or two finalists very soon, possibly in the next few days ahead of the April 4 annual shareholders meeting, Detroit Free Press newspaper said, citing people familiar with the talks. Once that happens, due diligence and negotiations that would perhaps last for months will follow to hammer out details and the sale price, it added. It said what is all but certain at this point is DaimlerChrysler (nyse: DCX - news - people ) will sell all or part of the Auburn-Hills-based US operations as Daimler's stock price has shot up more than 25 pct since Feb 14.
Auto Unions Plan United Front On Plans for Chrysler's Future
By Gina Chon
As potential buyers prepare to submit bids for the Chrysler Group, the unions of the United Auto Workers and the Canadian Auto Workers agreed Thursday to work together to present a united front.
In the final hours before potential buyers must submit bids to DaimlerChrysler (DCX) for its ailing Chrysler Group unit, private equity group Cerberus Capital Management has decided to go it alone, instead of bidding together with Canadian auto supplier Magna International (MGA), sources close to Cerberus and Magna say. Sources say the two sides couldn't come to terms on how they would structure a deal, and that Magna Chairman Frank Stronach wanted more control over a transaction than Cerberus would permit.
Meanwhile, Magna, which has a front seat at the bidding table, is interested in a minority stake in Chrysler and is teaming up with a private equity player. KeyBanc Capital Markets analyst Brett Hoselton said earlier this week that Magna has picked a private equity partner, and a source close to Magna says the company is linked with New York-based Ripplewood Holdings. Many industry watchers have questioned whether a bid from Magna makes sense. While the company has experience running car plants, it has not engineered complete models and taken them to market.
Three things have merged resulting in this blog. First, my insomnia (no I haven't slept yet), second, the Craftsman Truck series is in action again this weekend (remember I am a Dodge Racing fan when it comes to the trucks) and third one of my earlier blogs on the situation with Chrysler flared to life again yesterday. So here is an update on Chrysler from last week's news reports.
Union leaders on both sides of the Atlantic are vowing to fight a sale of DaimlerChrysler AG's Chrysler Group to a private-equity buyer, throwing a potential hurdle in front of a deal.
By Richard Milne in Munich and John Reed in London
Wolfgang Bernhard, the restructuring expert who helped to turn around Chrysler five years ago, has signed an advisory contract with Cerberus Capital Management, signficantly strengthening the private equity group's hand in the bidding for the US carmaker. Mr Bernhard, who was chief operating officer at Chrysler, signed the contract for a full-time role recently, according to several people familiar with the situation. The advisory mandate further helps the chances of Cerberus, already one of the favourites to buy Chrysler from DaimlerChrysler, its German parent.
Daimler has received preliminary expressions of interest from several other private equity funds since announcing that "all options" were open for its loss-making US unit in mid-February. General Motors has studied the possibility of co-operation with Chrysler and Magna International, the Canadian auto parts and assembly company, has expressed interest in the potential sale. Cerberus is increasingly active in the automotive sector. It last year led a group buying 51 per cent of GMAC, GM's financing arm and is also part o####roup seeking to buy Delphi, the bankrupt parts supplier. With potential investors like Cerberus and the Blackstone Group becoming increasingly interested in Chrysler, some bankers involved in the process believe a sale to private equity is likelier than to a competitor.
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