1st here's the link the hyperlink to the story I have quoted from.
http://news.excite.com/news/ap/001127/18/daimlerchrysler-kerkorian
here's a cut and paste:
"DETROIT (AP) - Billionaire investor Kirk Kerkorian
filed a $9 billion lawsuit Monday against DaimlerChrysler
AG, accusing chairman Juergen Schrempp of falsely
telling Chrysler shareholders that the 1998 combination with
Daimler-Benz was a
"merger of equals."
The suit, filed in Delaware by the Kerkorian-owned Tracinda Corp., is
the latest
trouble to beset the once-vaunted merger between the two auto
manufacturers, one of
the biggest industrial combinations in history.
Since the November 1998 deal, several top Chrysler officials have quit
or been fired
and the stock has plunged nearly 55 percent from its post-merger high
set in early
1999.
The Los Angeles-based Tracinda, which Kerkorian uses to control his
investments,
said in a statement that it is seeking to unwind the $34 billion deal.
It claims that it
would have never voted for the merger if it had been presented as a
takeover of
Chrysler by the Stuttgart, Germany-based company.'
Kerkorian, who launched a hostile takeover bid for the Auburn
Hills-based Chrysler in
1995 that led to a seat on Chrysler's board, is DaimlerChrysler's
third-largest individual
shareholder with about 4 percent of its shares. At the time of the
merger, he was
Chrysler's largest shareholder with 13.75 percent of its shares.
Kerkorian is also the majority shareholder in MGM Mirage Inc., the Las
Vegas-based
entertainment, hotel and gaming behemoth formed earlier this year by MGM
Grand's
$6.4 billion buyout of Mirage Resorts.
"To close one of the largest transactions in the history of the
automotive industry,
defendants Daimler-Benz AG and DaimlerChrysler AG blatantly lied to all
concerned in
a scheme masterminded by defendant Juergen Schrempp," the complaint said.
In a statement, DaimlerChrysler AG said the allegations "appear to be
completely
without merit," but said it had not yet seen the lawsuit and declined
further comment.
Tracinda cited comments Schrempp made recently to the Financial Times
that the
then-chairman of Daimler-Benz never intended DaimlerChrysler to be a
merger of
equals, but instead secretly planned to make Chrysler a division of the
German parent
company.
"Defendants always intended to relegate Chrysler to the status of a
division, always
intended to fire Chrysler's management and always intended to replace
them with
executives from their headquarters in Stuttgart," Kerkorian's complaint
said.
"Mr. Schrempp knew that Chrysler's directors and shareholders would
never approve
a transaction if he told the truth, namely, that a foreign corporation
was seeking to
acquire complete operating control of one of America's 'Big Three."'
Analyst David Healy with Burnham Securities said, however, there were
clear signs that
the deal was not a merger of equals when both boards approved it. The
majority of
shareholders were German, and Eaton promised to give up his title as
co-chairman
within three years.
"Kerkorian was an enthusiastic supporter" of those terms, Healy said.
"To me, it was
never a merger of equals."
In an Oct. 30 Financial Times interview, Schrempp is quoted as saying
there was no
need to keep pretending that the deal was designed as a merger of equals.
"The structure we have now with Chrysler (as a division) was always the
structure I
wanted," he said. "We had to go a roundabout way but it had to be done for
psychological reasons. If I had gone and said Chrysler would be a
division, everybody
on their side would have said: 'There is no way we'll do a deal."'
Kerkorian is seeking more than $2 billion in actual damages, $1 billion
in damages for
the drop in value of the DaimlerChrysler shares since the merger and
punitive damages
of at least $6 billion. Tracinda also said it "seeks to unwind the
transaction so that
Chrysler will once again be an independent corporation owned by Chrysler
shareholders."
More than a dozen senior Chrysler executives have resigned, retired, or
been forced
out since the deal was finalized. On Nov. 17, Chrysler president James
Holden was
fired by Schrempp and replaced by Dieter Zetsche, a veteran Mercedes-Benz
executive.
Besides Daimler-Benz, DaimlerChrysler and Schrempp, the suit filed in
U.S. District
Court in Delaware also names as defendants Manfred Gentz, the company's
chief
financial officer, and Hilmar Kopper, the chairman of its supervisory
board.
Before the merger, Kerkorian was often at odds with Chrysler management
over the
direction of the company, culminating with a $23 billion bid in 1995 to
buy Chrysler.
That bid failed, but in return for peace Kerkorian was given a seat on
Chrysler's board.
Since the merger, the value of DaimlerChrysler's shares has dropped
steadily, reaching
an all-time low of $37.90 after Holden's ouster and Zetsche's
appointment earlier this
month.
Chrysler posted a $512 million loss in the third quarter this year, as
it boosted
incentives to move a glut of minivans and other vehicles. Schrempp had
said that
Chrysler would post a profit in the fourth quarter, but the company has
since said that
Chrysler's results have continued to deteriorate.
Shares finished trading Monday at $41.50, up $1.02 on the New York Stock
Exchange. "
Maybe we'll get some results now.
Jamy
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