GM in talks to buy Chrysler
Posted: Fri Feb 16, 2007 12:30 pm
NEW YORK (CNNMoney.com) -- General Motors is in talks to buy DaimlerChrysler AG's struggling Chrysler group in its entirety, according to several reports.
According to the reports, sources in Germany and the United States said high-level talks between GM and DaimlerChrysler executives are taking place.
Chrysler Group announced Wednesday it would be cutting about 13,000 workers over the next three years as a part of a restructuring plan. Reports also said its German parent was considering selling or spinning off the unit.
Talks of an alliance between GM and DaimlerChrysler was first reported last week in Germany's Manager-Magazin.
The German publication said DaimlerChrysler Chairman Dieter Zetsche had met with GM Chairman Rick Wagoner about a possible sale of Chrysler to the automaker.
Other unnamed sources said to be familiar with the discussions confirmed the reports for Reuters and the industry newspaper Automotive News.
DaimlerChrysler employed J.P. Morgan Chase & Co. to consider options for the Chrysler Group, to help the automaker explore strategic options, according to reports.
But others are also skeptical on whether the discussions are real.
"This would be a at least $5 billion plus deal and GM is not that liquid right now," John Casesa said, an automotive analyst with Cases Strategic Advisors LLC. "I'm not convinced at all and I think it's unlikely."
Officials for DaimlerChrysler and GM issued no comments on the reports.
DaimlerChrysler has long tried to reverse the drop in sales with previous cost-cutting moves but slipped into the No. 4 spot last year behind Toyota in the United States.
Renault Nissan's Chief Executive Officer Carlos Ghosn expressed interest in the past in buying the automaker.
Chrysler, GM seen in SUV partnership talks
