Chrysler, GM Discuss Merger, Acquisition

Detroit Automakers In Talks About Combining Operations, Jettisoning GMAC Financial Arm

(AP)  General Motors Corp., Chrysler LLC and Cerberus Capital Management LP have held preliminary talks about a merger or an acquisition of Chrysler by GM, according to a person familiar with the talks.

Chrysler, which is 80.1 percent owned by Cerberus, already has a joint venture with GM making a hybrid gas-electric powertrain, and has discussed a full merger or acquisition with GM, said the person, who did not want to be identified because the talks have not been made public.

The Wall Street Journal, citing people it described as familiar with the discussions, reported that Cerberus, a private equity firm that also owns 51 percent of GMAC Financial Services, proposed trading Chrysler's automotive operations to GM in exchange for GM's remaining 49 percent stake in GMAC.

The New York Times, also citing people familiar with the talks, reported that the automakers were discussing a merger.

GMAC, primarily an auto lender, also has significant mortgage lending operations that have been hit hard by the crisis in that industry.

The talks have stalled because of the recent turmoil in the financial markets, according to the Journal. Its sources said negotiations could resume if markets stabilize because both GM and Cerberus want to quickly divest the assets under discussion.

The negotiations between 100-year-old GM and 83-year-old Chrysler have began more than a month ago. The Times said its sources pegged the chances of a merger being completed at "50-50."

"Without referencing this specific rumor, as we've often said, GM officials routinely discuss issues of mutual interest with other automakers," GM spokesman Tony Cervone said in an e-mail.

"The company is looking at a number of potential global partnerships as it explores growth opportunities around the world," Chrysler said in an e-mailed statement issued Friday night.

"Beyond those partnerships already announced, however, Chrysler has not formed any new agreements and has no further announcements to make at this time."

A tie-up between the automotive giants would be historic for the industry and solidify GM's position as the global sales leader, which it has been in danger of losing to Toyota Motor Corp. GM and Toyota finished 2007 essentially even in vehicles sold worldwide.

This would not be the first time Detroit's automakers have explored mergers.

GM talked with DaimlerChrysler AG in 2007 about acquiring Chrysler before Cerberus made a deal to acquire most of the automaker, but the talks fell through when GM decided it should concentrate on cost savings and efficiencies by globalizing its own operations.

In 2005, GM and Ford Motor Co. reportedly held talks regarding a potential business combination.

Cerberus acquired its GMAC stake in 2006 for $14 billion and bought 80.1 percent of Chrysler from Daimler AG in August 2007 in a $7.4 billion deal. Cerberus and Daimler confirmed last month they are in talks for Cerberus to acquire Daimler's remaining Chrysler stake.

The auto industry has been hit hard in recent weeks by the effects of the credit crisis, prompting GM and Ford to issue statements Friday to dispel the notion that they might be headed for bankruptcy.

GM and Ford shares were battered with the rest of the stock market this week, falling to lows not seen in decades. GM shares lost about half of their already-depressed value during the week, closing at $4.89 on Friday. Ford shares fell similarly, ending the week at $1.99.

[lochlan-2009]

Bought a thousand more shares on Friday at $4.38 :))!!! $6.50 a share right now is going to give me such a return. This stock should be back in the 40 to 50+ range come 2010-2012. If you can''t see this "to big to fail" stock has been pushed down since last October, so the rich and connected can get in and ride it back up to its real worth, for a 10-fold return in a couple of years, you shouldn''t have your money in the market. This is a free-be. Thank you greedy elite ;)

[hologram5]

Can you imagine a plymouth blazer? Or a chevy neon?

[dan_shields-2009]

it''s not such a bad idea seeing how both companies are in the crapper big time.

[heero78-2009]

this doesnt affect me. im still going to have to wash recycle my condoms.

[incog-nito]

The Big Three will soon become like Harley Davidson, surviving by making nostalgia vehicles like the muscle cars of a bygone era.

[painbslapu]

OH NO! CHRYSLERS ARE GOING TO BE OIL BURNERS LIKE GMS!

OUR PLANET IS DOOMED! DOOMED, DOOMED, DOOMED I SAY!!

[tannerbird]

COME NOV4 THE PEOPLE IN WASHINGTON NOW NEED TO BE VOTED OUT NO MATTER WHAT PARTY THAT WAY WE ARE SURE TO GET THE RIGHT ONES!

[samthetvcat]

Wow, the stock''ll go back down if/when the merger doesn''t go through, right?

meh, probably just better to stick to underlying worth as always as a guide to what to pick when the market bottoms out (?)

[lastdance127]

Censored From ABC News :

The Average Retired Union Autoworker is Receiving between :
$612.00 and $1,400.00 a month
Health Insurance is PAID by : The Retiree

The Autoworker Union Members __ Have NEVER Received
The Pay Scale or Retirement Benefits Equal to
THE FEDERAL EMPLOYEE

The Federal Employee, who has never learned how to Work
The Federal Employee, Who Has NEVER Had to Make Production
The Federal Employee, Who works at a LEISURELY PACE
Making Little or no Production ! !

What you see on TV as Auto Production
Is Staged by Management Employees

Figure it Out __ One (1) Full Sized Car built every Sixty Three (63) Seconds
Three (3) Seconds between each car __ One car Built every minute
Four Hundred and eighty (480) Full Sized Cars Built each
Eight (8) hour Shift __ Monday through Saturday
Overtime is Minatory - No Refusal

One (1) Twelve (12) minute Break in the morning (company assigned)
One (1) fourteen (14) minute break in The afternoon (company assigned)
Three (3) Times Tardy or Absent in a Eighteen (18) Month Period
Your Fired ! !

The Federal Employee couldn''t - "Survive" in a Production Environment

If you complain about : PAY SCALE and RETIREMENT Benefits
Look to the - DEAD BEAT - Federal Employee ! !

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[lastdance127]

Censored From ABC News :

Each Year Auto Manufactures Ask for and
Have Been Getting FREE Money from The Federal Government
Every Year - For DECADES

Under The Nazi Fascist : Reagan-Bush Crime Regime
Chrysler was the First Automaker to close a
Auto Manufacturing Plant (Wisconsin)

20,000 Jobs lost in One Day) and to Send Those Jobs
Outside of the United States

That Year Chrysler Management gave themselves a
$29 Million Dollar Pay Bonus _ Saying
"They were such a good management team".

Criminal Corporate NAZI Fascist America
Will do as it has always Done
MOCK and Ridicule The American TAXPAYER

Any Corporation or Political Influence :
That has Supported and Assisted in : The Achievement of
PURPOSELY and INTENTIONALLY Destroying The :
ECONOMIC INFRASTRUCTURE of The United States is an
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If your Comments have have been Censored from
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[lastdance127]

Censored From ABC News :

Any Japanese Car Sold in the US by an US Auto Manufacturer
That money goes into a Japanese Controlled Bank in the US
At Night The Money is Transferred To Banks in Japan
The Same with The "GERMAN" Auto Maker

Dahlmer-Chrysler __ Get it Yet ??

The Money that is Given to US Auto Manufactures
Does NOT STAY in The United States

The Achievement of : Criminal Corporate NAZI Fascist America

ECONOMIC STRIFE - That is Being used as a Weapon to
ELIMINATE a DEMOCRACY _ and _ REPLACE IT
With The Totalitarian Dictatorship of : A NAZI FASCIST RULE
Against : The Populace of the United States

Any Corporation or POLITICAL INFLUENCE
That has Supported and Assisted in :
The Achievement of : PURPOSELY and INTENTIONALLY DESTROYING
The DEMOCRATIC INFRASTRUCTURE and The ECONOMIC INFRASTRUCTURE
of The United States is an : Act of TREASON

ECONOMIC STRIFE : Has always Been
The Endorsement of : The Republican NAZI Fascist Party

If your Comments have have been Censored from
ABC News Comments

Contact the : Civil Liberties Union
Ask for a CLASS ACTION LAWSUIT Against :
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Ask The Civil Liberties Union :
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[mcv57]

Halliburton?
-------------------------
Posted by Amazedd

LoL, Tyco and Mattel Toys would be more technically suitable for corporate intergration.

[amazedd]

Halliburton?

[amazedd]

My Way, or The Highway.

[mcv57]

Any know who will merge with Ford?