It looks like Cerberus is abandoning ship and they know they can't get anymore low interest loans.03/31/2009, 1:26 PM
Cerberus to give up stake in Chrysler for Fiat alliance
President Obama made it clear on Monday that Fiat must be part of Chrysler’s plans if it hopes to survive beyond the next 30 days, but Chrysler’s owners, Cerberus Capital Management, apparently won’t be a part of the future Chrysler – should the ailing automaker make it.
According to The Detroit News, Cerberus has agreed to give up its 80.1 percent stake in Chrysler should the Michigan automaker ink a strategic alliance with Italy’s Fiat. However, Cerberus would retain its stake in Chrysler Financial, with the first $2 billion in profits earmarked for a government repayment.
It remains unclear exactly how Cerberus’ ownership of Chrysler would shake out but, as Fiat is set to gain a 35 percent share of Chrysler, something had to give. Daimler, Chrysler’s former partner, still retains a 19.9 percent stake in Chrysler.
The Obama administration gave Chrysler a 30-day time limit to partner with Fiat or face Chapter 7 bankruptcy liquidation. While initial reports are optimistic the two auto giants can combine in a month’s time, there are still plenty of hurdles that threaten the success of the deal.
Here any article on the matter
Fiat execs come to U.S. to hash out new Chrysler deal