February 1, 2001
BY BRIAN LYSAGHT
BLOOMBERG NEWS
FRANKFURT -- DaimlerChrysler AG, the world's fifth-largest carmaker, said
that it hasn't prepared any defense against a takeover bid and that a
takeover was "not an issue."
Reuters reported yesterday that the company hired Deutsche Bank AG and J.P.
Morgan Chase & Co. to advise on ways of heading off a possible takeover bid,
citing people familiar with the industry.
"A potential takeover is not an issue, nor is a strategy to prevent one,"
said spokesman Christoph Walther in a faxed statement. The statement made no
reference to whether the company had hired the banks.
The automaker probably has hired bankers to consider how to boost the share
price or to dispose of the U.S.-based Chrysler unit if a plan to fix the
money-losing business fails, said Lehman Brothers analyst Nicholas
Lobaccaro. DaimlerChrysler said Monday it will cut 26,000 jobs and close six
Chrysler plants.
If the turnaround plan doesn't work, "DaimlerChrysler would have no
alternative but to consider disposing of some or all of its Chrysler
operations," Lobaccaro wrote in a report today.
The Chrysler business could be worth more than $10 billion, Lobacarro wrote,
and Toyota Motor Corp., General Motors Corp., Ford Motor Co. and Volkswagen
AG might be interested, he said.
Lobaccaro couldn't be reached to elaborate. DaimlerChrysler spokesman
Michael Pfister declined to comment.
The company's shares in the U.S. fell as much as 2.9 percent to $46.65 after
rising 1.6 percent yesterday. The shares in Frankfurt rose as much as 1.55
euro, or 3.1 percent, to 51.39. They were trading at 51 euros recently.
The Reuters report said that only Toyota, the world's third largest
carmaker, would have the resources to make a bid. DaimlerChrysler's market
value is about 51.8 billion euros ($48.2 billion) while Toyota's is 137.2
billion euros.
Toyota President Fujio Cho and Chairman Hiroshi Okuda have said repeatedly
the company isn't interested in foreign acquisitions. Toyota today
reiterated that position and said it wasn't making a bid.
"We have no interest in that type of move," said Toyota spokesman Paul
Nolasco.
Walther said that DaimlerChrysler "remains in the forefront of the
automobile industry" and that "there is no doubt in the great potential for
growth in this company's share price."
The shares have fallen about 21 percent since Daimler-Benz AG acquired
Chrysler Corp. in 1998 for about $35 billion. They have risen about 18
percent in Frankfurt this year on hopes that Chrysler's reorganization will
bring the unit back to profit.
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Steven St.Laurent
2000 Dakota Hemi 4.7 (WRECKED!!)
2000 Ford Roush Mustang Stage III - TT version (sold)
1999 Chebby (gone in 2003)
1993 Tracker (still going-going-going...)
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Aspiring for now:
2003 Dakota Hemi 5.7 or a V-10 mod
2003/4 Viper GTS-R
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