Results 1 to 3 of 3

Thread: GM-Chrysler merger apparently still being looked at...

  1. #1
    Vulture of The Western World Eric's Avatar
    Join Date
    Jul 2006
    Location
    The Land of The Edentulites
    Posts
    22,770

    GM-Chrysler merger apparently still being looked at...

    General Motors and Cerberus Capital Management have resolved the major issues in a proposed GM-Chrysler merger, but the final form of any deal would depend on the financing and government support available, sources familiar with the talks said on Wednesday.

    Both sides have agreed that GM Chief Executive Rick Wagoner would lead the combined automaker, the sources said. A merged GM/Chrysler would be the largest automaker by global sales.

    As GM seeks some $10 billion in U.S. government aid to support the deal, Chrysler owner Cerberus is in its own set of intense discussions with banks to refinance Chrysler debt, the sources said.

    The lending consortium - which includes JPMorgan Chase & Co, Goldman Sachs Group Inc., Citigroup Inc., and Morgan Stanley - has not made a decision yet, and talks are complicated because lenders have sold part of the debt to other investor groups, the sources said.

    The banks hold the first-lien loan of $7 billion issued to finance the Cerberus buyout of an 80-percent stake in Chrysler from Daimler AG last year. Banks have been selling off parts of it in an effort to trim their exposure to risky leveraged buyout debt.

    Cerberus and Daimler provided a $2 billion second-lien loan to Chrysler due to weak interest for that debt.

    GM has been in talks with Cerberus about buying Chrysler since last month, but the discussions have been snagged by difficulty in securing investment or financing at a time when credit is tight and global auto sales are rapidly declining, others close to the talks have said.

    A decision by the Bush administration to provide the government's first funding for the auto sector since the $1.5 billion bailout of Chrysler in 1980 has been widely seen as the merger's best chance for success.

    The United Auto Workers union has been approached by GM in the course of the talks with Cerberus, people familiar with the negotiations said.

    As a condition of government support, GM has offered to merge the auto operations in a way that protects as many jobs and as much of the Chrysler sales volume as possible, sources have said.

    Analysts have been skeptical that the merged automaker, which would control some 33 percent of the U.S. market, could be turned around quickly since GM and Chrysler are seen to be struggling with many of the same problems, including excess production capacity and too many dealers.

    GM and Cerberus had no comment. A UAW spokesman had no immediate comment.


  2. #2
    Senior Member
    Join Date
    Jul 2006
    Location
    Raleigh NC, USA
    Posts
    3,628

    Re: GM-Chrysler merger apparently still being looked at...

    I have NO idea why this is still going on.

    Chip H.

    Former owner: 2012 Honda Civic LX, 2006 Honda Ridgeline RTL, 2000 Honda CR-V EX, 2003 MINI Cooper S, 1992 Honda Accord LX, 1999 Mercedes ML-320, 1995 VW Jetta GLX, 1991 Mercury Capri XR2, 1981 Mercury Zephyr, 1975 Chevrolet Impala

  3. #3
    Vulture of The Western World Eric's Avatar
    Join Date
    Jul 2006
    Location
    The Land of The Edentulites
    Posts
    22,770

    Re: GM-Chrysler merger apparently still being looked at...

    Quote Originally Posted by chiph
    I have NO idea why this is still going on.

    Chip H.
    I have come up with one reason:

    GM, by acquiring Chrysler, may provide the window-dressing for a "private" bail-out that will nonetheless by subsidized by the taxpayers via BS "loans" from large commercial banks - which of course are financed by the Hey! Presto! magic of the Federal Reserve's money-printing machine.

Similar Threads

  1. It looked like you were speeding...
    By Eric in forum Fight Traffic Tickets/Driving Issues
    Replies: 1
    Last Post: 06-18-2010, 05:44 PM
  2. Haven't even looked at my bikes in weeks....
    By Eric in forum On Two Wheels
    Replies: 17
    Last Post: 02-19-2010, 03:53 PM
  3. GM, Chrysler merger details...
    By Eric in forum Automotive News
    Replies: 8
    Last Post: 10-19-2008, 10:20 AM
  4. Merger
    By TC in forum Automotive News
    Replies: 5
    Last Post: 10-11-2008, 03:11 PM
  5. This Chrysler/GM merger thing....
    By Eric in forum Motor Mouth
    Replies: 21
    Last Post: 02-21-2007, 10:51 AM

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •