numbers we were told in yesterday's meeting was purchased 100% for $32-36B.
Sold almost 80% for $7.4B they did not disclose the fact that the new
company also picked up almost $20B in retirement benefit liability as well;
so they actually just got about 80% of Chrysler for more like $27B; and
Diamler still holds 21% stock. Technically Diamler didn't do bad for
tapping OUR resources for several years; and still holding enough to
participate and share in developements.
Aaron Wyse
----- Original Message -----
From: "Gabriel A. Couriel" <gcouriel@bellsouth.net>
To: <dakota-truck@dakota-truck.net>
Sent: Monday, May 14, 2007 9:21 AM
Subject: DML: RE: Here we go...
>
> just want to point out the fact that Daimler-Benz bought (not "merged")
> Chrysler Corp. for $32billion and is now dumping it for $4.5billion. I'm
> just happy those tools get what they deserve.
>
> Gabriel A. Couriel
>
> 2006 DML Fantasy Football Champion
>
>
> -----Original Message-----
> From: owner-dakota-truck@bent.twistedbits.net
> [mailto:owner-dakota-truck@bent.twistedbits.net]On Behalf Of DAKSY
> Sent: Monday, May 14, 2007 6:51 AM
> To: Dakota Mailing List
> Subject: DML: Here we go...
>
>
> Hey, DML!
>
> From today's New York Times...
>
> By MICHELINE MAYNARD and MARK LANDLER
> Published: May 14, 2007
> FRANKFURT, May 13 - DaimlerChrysler appears close to selling the
struggling
> Chrysler Group to a private equity firm that specializes in restructuring
> troubled companies, unwinding a 1998 merger that was meant to create a
> trans-Atlantic automotive powerhouse, people with direct knowledge of the
> discussions said on Sunday.
>
>
> An announcement could come as soon as Monday, though last minute details
> could delay a final agreement between the investment firm, Cerberus
Capital
> Management, and Chrysler's parent, DaimlerChrysler, these people said.
They
> insisted on not being named because the talks were confidential.
> The prospect of private ownership alarms Chrysler's labor unions, which
have
> come out strongly against the sale of the company, fearful that an
investor
> might try to break up the company or seek deep cuts in wages and benefits.
> A sale of Chrysler to Cerberus "will shake the ground under people's feet
in
> a huge way," said Kevin Boyle, a professor at Ohio State University who
has
> written extensively about Detroit as the auto capital.
> Under the terms of the deal being discussed, DaimlerChrysler would keep
> about a 20 percent stake in Chrysler and would be freed from nearly $20
> billion in pension and health care liabilities for Chrysler's current and
> retired workers. The liability would be transferred to a new company
> controlled by Cerberus.
> The sale price was not clear, though executives said the primary value of
> the deal was in the assumption of Chrysler's costs. As a result, little or
> no money may change hands in the deal.
> If the sale takes place, it would take apart a deal intended to create a
> blueprint for the global automotive industry that sank under the
difficulty
> of putting a mass market brand, Chrysler, together with Mercedes-Benz, a
> luxury company, while keeping both prosperous.
> It would also be a watershed for private equity companies, which have
become
> audacious bidders for companies as varied as retailers, steel companies
and
> airlines in the last few years.
> But never before has one of them purchased a company as iconic as
Chrysler,
> whose Dodge and Jeep brands are so embedded in the American culture that
the
> company's near-bankruptcy led to a federal bailout in 1979 that made Lee
A.
> Iacocca, then its chief executive, a household name.
> With General Motors, Ford Motor and Chrysler all fighting big foreign
> competitors like Toyota, "in some ways, the American automobile industry
is
> almost unrecognizable from what it was 25 or 30 years ago," Professor
Boyle
> said.
> Among the issues still to be settled is the amount of investment capital
> Cerberus will inject into the new Chrysler to finance its operations,
> according to one executive.
> "It is not yet a done deal, but it is heading the right way," a person
> involved in the talks said on Sunday night. Another official with
knowledge
> of the talks said no agreement had been signed.
> Daimler-Benz of Germany was an eager bidder for Chrysler nine years ago,
> attracted by its highly profitable lineup of Jeeps and minivans. It paid
$36
> billion for Chrysler in what was originally portrayed as a merger of
equals
> but ended up being a German takeover.
> The merger has never resulted in the savings or market power that its
> creators envisioned, however. Chrysler's fortunes have been on a constant
> roller-coaster ride, with profitable years followed by years of losses,
> including a $1.5 billion loss in 2006, when Chrysler fell to fourth place
in
> the American market behind Toyota. (It had a 12.6 percent share of the
> domestic market in 2006, from a peak of 16 percent in 1999.)
> Meanwhile, Daimler's parallel expansion into Asia ran aground because of
> troubles at its Japanese partner, Mitsubishi Motors. It thought Mitsubishi
> might serve as the third leg of its global stool when it purchased a stake
> in 1999. But Mitsubishi's legal and financial troubles forced Daimler to
> take management control in 2002, and Daimler ended that alliance in 2004.
> In February, DaimlerChrysler announced that it was keeping all of its
> options open for Chrysler, including a sale or finding a partner to run
the
> company. At the same time, DaimlerChrysler announced a restructuring plan
> for Chrysler, the second such plan in the last seven years.
> Under the latest turnaround, which calls for the company to cut 16 percent
> of its work force, or 13,000 jobs, Chrysler is not expected to be
profitable
> again until 2009. DaimlerChrysler, whose board is meeting early this week,
> is scheduled to announce its first-quarter earnings on Tuesday.
> Cerberus's Strategic Plan May Finally Be Paying Off (May 14, 2007)
> Cerberus emerged as the leading bidder for Chrysler late last week, people
> involved in the transaction said.
> Along with Cerberus, other interested bidders in Chrysler included
> Blackstone, which was exploring a purchase in conjunction with
Centerbridge
> Partners.
> Magna International, the Canadian auto parts company, and the Tracinda
> Corporation, the holding company owned by the billionaire Kirk Kerkorian,
> also said they had made bids for Chrysler.
> Officials at those companies said on Sunday night that they had not been
> notified that Cerberus was the winner.
> Over the last few days, officials at Cerberus and DaimlerChrysler have
been
> involved in detailed discussions, which have been shepherded by JPMorgan,
> DaimlerChrysler's investment adviser.
> Participants in the talks said on Sunday night that union leaders had been
> informed of the discussions with Cerberus.
> But Chrysler's unions, including the United Automobile Workers and the
> Canadian Automobile Workers, have said they would prefer that Chrysler not
> be sold. The U.A.W.'s president, Ron Gettelfinger, has a seat on the
> supervisory board at DaimlerChrysler, which would have to approve any
deal.
> A deal with Cerberus "puts an enormous amount of pressure on the union,"
> said David E. Cole, chairman of the Center for Automotive Research in Ann
> Arbor, Mich.
> The union thought private equity "would be the end of the world, and in
some
> ways it probably would be," Mr. Cole said. "The union is in a horrifying
box
> right now. There's got to be some real hardball that's a part of this to
get
> the rank and file to go along with it."
> Cerberus, whose automotive investment operations are headed by David W.
> Thursfield, a former executive with the Ford Motor Company, will probably
> keep Chrysler's management in place, at least for now, people with
knowledge
> of the discussions said.
> Chrysler's former president, Wolfgang Bernhard, who advised Cerberus, may
> receive a seat on the board of the new Chrysler or play some other role.
> Mr. Bernhard has visited Chrysler several times in the last few weeks, and
> has remained friendly with DaimlerChrysler's chief executive, Dieter
> Zetsche, who held that job at Chrysler when Mr. Bernhard was president
> during the early 2000s.
> A sale to Cerberus would mark the company's latest investment in an
> automotive-related company. Last year, Cerberus, which owns the car-rental
> companies National and Alamo, led a consortium that purchased a 51 percent
> stake in the General Motors Acceptance Corporation, the financing arm of
> General Motors.
> Cerberus also reached a tentative agreement to purchase a controlling
> interest in the Delphi Corporation, an auto parts supplier that used to be
> owned by G.M. and is operating in bankruptcy. But that transaction
stalled,
> after Delphi and G.M. were unable to agree on contract terms with the
U.A.W.
> As private equity firms have appeared more often in the headlines, they
have
> also attracted scrutiny. Along with the unions, government officials have
> expressed increasing concern over the financial restructurings that are
the
> lifeblood of buyout firms; their overhauls of companies have often
included
> massive cuts in jobs or benefits. In countries like Germany and France,
> private equity firms have been derided as locusts that strip companies of
> their assets.
> Last month the Service Employees International Union, a politically active
> organization that represents nearly two million workers, released a report
> expressing public policy concerns about private equity. Among those were
> questions about the lack of disclosure and about certain tax breaks for
> buyout firms.
> Nonetheless, DaimlerChrysler's shares have climbed 15 percent, to $82 on
> Friday, since mid-February, when private equity firms entered the bidding
> for Chrysler. At the company's raucous annual meeting in Berlin last
month,
> a succession of shareholders stood up to demand that the company move
> swiftly to dispose of Chrysler.
> "This marriage made in heaven turned out to be a complete failure," said
> Hans-Richard Schmitz, who represented the German Association for the
> Protection of Shareholders. "What's missing now is a swift resolution of
the
> issue by the management of the group."
> This week, the shareholders may get their wish.
>
> Bob (DAKSY) Smith
> DAKSY2K on AIM
> 2K SY Dakota Sport +
> V-6 4 x 4 5 speed
> 2K05 HD 883C YP
> http://home.nycap.rr.com/daksy/
> Averill Park, NY
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