Gm Chrysler merger-This is the End Of The Road For Chrysler

GM Chrysler News reported this 2 months ago. The GM Chrysler Merger was and is a done deal! They just need some cash to buy out Daimler and then transfer the 49% of GMAC to Cerberus and GM will Get Chrysler's assets.

I find it amusing all these supposedly automotive experts are surprised that GM Chrysler is talking merger again. Both companies have told us 2 months ago they where going to merge. The only hold up was GM needed more cash! Well guess what, the money will be coming soon.

The auto rescue bridge loan was all part of the plan to facilitate the GM Chrysler Merger!

GM idled 22 factories and Chrysler idled 30,Sadly the workers at GM and Chrysler do not know that some of these plants will never open up again, Especially if the GM Chrysler Merger goes through.

GM Chrysler News-J.F.

Chrysler News-What is the best scenario for Chrysler Workers?

Well the fears for Chrysler workers maybe coming true. GM Doesn't have the money right away to acquire Chrysler and has placed the merger on hold for the short term, so Cerberus is looking to sell the company in pieces.

From auto reports around the globe, the GM Chrysler Merger may be a better scenario for workers instead of parting it out. Analyst believe that Cerberus may have difficulty selling all the divisions or car lines of Chrysler. The Jeep line maybe the easiest to sell, but what does Cerberus do if it can't sell the rest?

Automotive reports have Hyundai Motors interested in the Jeep lineup and at one time Nissan was the front runner for the Dodge Pickup line. But current reports say Nissan just wants alliances and probably wouldn't want to spend billions purchasing Dodge.

The only vehicles of Chrysler that seem to have any interest from other companies are the: Jeep line, Mini-vans and Dodge Ram.

What are the options for Cerberus? What is their time table? and how much money can they stomach losing as they sit idle?

Maybe the best scenario would be taking Chrysler public and buying out Cerberus to save 66,000 jobs!


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Chrysler News-What is the best scenario for Chrysler Workers?

Well the fears for Chrysler workers maybe coming true. GM Doesn't have the money right away to acquire Chrysler and has placed the merger on hold for the short term, so Cerberus is looking to sell the company in pieces.

From auto reports around the globe, the GM Chrysler Merger may be a better scenario for workers instead of parting it out. Analyst believe that Cerberus may have difficulty selling all the divisions or car lines of Chrysler. The Jeep line maybe the easiest to sell, but what does Cerberus do if it can't sell the rest?

Automotive reports have Hyundai Motors interested in the Jeep lineup and at one time Nissan was the front runner for the Dodge Pickup line. But current reports say Nissan just wants alliances and probably wouldn't want to spend billions purchasing Dodge.

The only vehicles of Chrysler that seem to have any interest from other companies are the: Jeep line, Mini-vans and Dodge Ram.

What are the options for Cerberus? What is their time table? and how much money can they stomach losing as they sit idle?

Maybe the best scenario would be taking Chrysler public and buying out Cerberus to save 66,000 jobs!


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Chrysler News-Cerberus still seeks takers for Chrysler

Latest From The Detroit News

Alisa Priddle / The Detroit News

Cerberus Capital Management LP is seeking other options for Chrysler LLC after frontrunner General Motors Corp. suspended its acquisition efforts.

Two people familiar with the matter confirmed that Cerberus wants to re-engage the Renault SA-Nissan Motor Co. alliance after those discussions ended last week when it became apparent that Cerberus favored a deal with GM.

Hyundai Motor Co. Ltd. is described as one of a number of companies with which Cerberus continues to talk about a strategic partnership or the acquisition of some or all of Chrysler's automotive assets, a source familiar with the situation said. The source stressed that Hyundai did not just jump into the fray upon GM's exit.Chrysler will not remain intact, predicted Charles Chesbrough, senior economist for CSM Worldwide, an automotive market research firm in Northville. "The next step is that Chrysler would be broken up and pieces taken over by other companies," he said, noting there don't appear to be many suitors interested in the entire company.
...More

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Chrysler News-Cerberus still seeks takers for Chrysler

Latest From The Detroit News

Alisa Priddle / The Detroit News

Cerberus Capital Management LP is seeking other options for Chrysler LLC after frontrunner General Motors Corp. suspended its acquisition efforts.

Two people familiar with the matter confirmed that Cerberus wants to re-engage the Renault SA-Nissan Motor Co. alliance after those discussions ended last week when it became apparent that Cerberus favored a deal with GM.

Hyundai Motor Co. Ltd. is described as one of a number of companies with which Cerberus continues to talk about a strategic partnership or the acquisition of some or all of Chrysler's automotive assets, a source familiar with the situation said. The source stressed that Hyundai did not just jump into the fray upon GM's exit.Chrysler will not remain intact, predicted Charles Chesbrough, senior economist for CSM Worldwide, an automotive market research firm in Northville. "The next step is that Chrysler would be broken up and pieces taken over by other companies," he said, noting there don't appear to be many suitors interested in the entire company.
...More

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Cerberus chief: Country can't let automakers fail

Cerberus chief: Country can't let automakers fail

Tom Krisher / Associated Press
DETROIT -- A top official of the company that owns most of Chrysler LLC says the country needs an economic stimulus package and must make sure the U.S. auto industry doesn't fail.

Cerberus Capital Management LP Chairman John Snow said Wednesday that president-elect Barack Obama and his treasury secretary need a bipartisan plan to counter the worst economic downturn in about 50 years.

"What we need is to make sure that a vital industry like autos ... which is such a big part of the overall economy, doesn't lead us into a deeper and harsher downturn," Snow said in an interview on the CNBC cable channel. "The collapse of the auto industry at this time would be devastating for a new president." ...article


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Cerberus chief: Country can't let automakers fail

Cerberus chief: Country can't let automakers fail

Tom Krisher / Associated Press
DETROIT -- A top official of the company that owns most of Chrysler LLC says the country needs an economic stimulus package and must make sure the U.S. auto industry doesn't fail.

Cerberus Capital Management LP Chairman John Snow said Wednesday that president-elect Barack Obama and his treasury secretary need a bipartisan plan to counter the worst economic downturn in about 50 years.

"What we need is to make sure that a vital industry like autos ... which is such a big part of the overall economy, doesn't lead us into a deeper and harsher downturn," Snow said in an interview on the CNBC cable channel. "The collapse of the auto industry at this time would be devastating for a new president." ...article


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Will President Obama Talk To Cerberus and GM this week?

Well the Election is over, now President Obama and the Dems face some real serious issues.One of the major issues is whether or not the Federal Government will help the auto industry.

President Obama said he would speak to Cerberus and GM after the election.

One would speculate that with Michigan having a Democratic Governor and a new Democratic President stepping into office the merger will happen. It is just a matter of crafting a financially sound plan from the Federal Governments stand point.
Which means what will the auto companies give in return for large sums of cash?

Many reports rumor to have Cerberus talking to other potential buyers, but Cerberus wants to sell Chrysler as a whole because it would have more value. It is possible Nissan could buy Chrysler and sell off what is doesn't want.

But for Cerberus the sweet deal is with General Motors! It gets the rest of GMAC financing for Chrysler and would swiftly be out of the car business. You don't have to be an accountant, lawyer and auto beat writer to figure that out!

We will probably hear more merger news by the weeks end. This is still a serious problem that needs to be addressed immediately and millions of jobs are counting on some intelligent action.

Here is another Gm Chrysler Merger Report--Researched by Industrial Info Resources

GM-Chrysler Merger Talks on Hold Until After Election, as Bush Administration Won't Finance Buyout

SUGAR LAND--November 4, 2008--Researched by Industrial Info Resources (Sugar Land, Texas)--In-depth talks between General Motors Corporation and Chrysler LLC (Auburn Hills, Michigan) have reached an impasse and will be placed on temporary hold until after the November 4 elections, as the Bush administration has opted not to finance the merger of the two automotive giants. GM and Chrysler had been asking the Bush administration for $10 billion-$15 billion in government aid to help finance the merger; however, that aid was denied late last week.

In the meantime, Cerberus Capital Management LP (New York, New York), the private equity firm that owns the majority of Chrysler, will reopen talks with other potential suitors who may be interested in acquiring the ailing automaker.

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Will President Obama Talk To Cerberus and GM this week?

Well the Election is over, now President Obama and the Dems face some real serious issues.One of the major issues is whether or not the Federal Government will help the auto industry.

President Obama said he would speak to Cerberus and GM after the election.

One would speculate that with Michigan having a Democratic Governor and a new Democratic President stepping into office the merger will happen. It is just a matter of crafting a financially sound plan from the Federal Governments stand point.
Which means what will the auto companies give in return for large sums of cash?

Many reports rumor to have Cerberus talking to other potential buyers, but Cerberus wants to sell Chrysler as a whole because it would have more value. It is possible Nissan could buy Chrysler and sell off what is doesn't want.

But for Cerberus the sweet deal is with General Motors! It gets the rest of GMAC financing for Chrysler and would swiftly be out of the car business. You don't have to be an accountant, lawyer and auto beat writer to figure that out!

We will probably hear more merger news by the weeks end. This is still a serious problem that needs to be addressed immediately and millions of jobs are counting on some intelligent action.

Here is another Gm Chrysler Merger Report--Researched by Industrial Info Resources

GM-Chrysler Merger Talks on Hold Until After Election, as Bush Administration Won't Finance Buyout

SUGAR LAND--November 4, 2008--Researched by Industrial Info Resources (Sugar Land, Texas)--In-depth talks between General Motors Corporation and Chrysler LLC (Auburn Hills, Michigan) have reached an impasse and will be placed on temporary hold until after the November 4 elections, as the Bush administration has opted not to finance the merger of the two automotive giants. GM and Chrysler had been asking the Bush administration for $10 billion-$15 billion in government aid to help finance the merger; however, that aid was denied late last week.

In the meantime, Cerberus Capital Management LP (New York, New York), the private equity firm that owns the majority of Chrysler, will reopen talks with other potential suitors who may be interested in acquiring the ailing automaker.

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AP Report 11/03/08--Cerberus Waiting For New Prez. To Help Broker GM Chrysler Deal

AP source: Next prez to shape any GM-Chrysler deal

DETROIT: Discussions over potential government funding to facilitate a General Motors acquisition of Chrysler are on hold until after Tuesday's election, and the end result likely will be decided by whoever wins the presidential contest, according to a person briefed on the financing details of the negotiations.

General Motors Corp. and Chrysler LLC were still reviewing numerous options to help the deal, including tapping into a portion of the $700 billion federal bailout being administered by the Treasury Department, the person said Monday.

"I think it's silly for anyone to count anything out," said the person, who asked not to be identified because the negotiations are private.

Another person briefed on the talks said that despite reports to the contrary, Nissan Motor Co. is still involved in the discussions, although Chrysler's majority owner, Cerberus Capital Management LP, would prefer GM as a single buyer.

That person also spoke on condition of anonymity because the talks are confidential.

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AP Report 11/03/08--Cerberus Waiting For New Prez. To Help Broker GM Chrysler Deal

AP source: Next prez to shape any GM-Chrysler deal

DETROIT: Discussions over potential government funding to facilitate a General Motors acquisition of Chrysler are on hold until after Tuesday's election, and the end result likely will be decided by whoever wins the presidential contest, according to a person briefed on the financing details of the negotiations.

General Motors Corp. and Chrysler LLC were still reviewing numerous options to help the deal, including tapping into a portion of the $700 billion federal bailout being administered by the Treasury Department, the person said Monday.

"I think it's silly for anyone to count anything out," said the person, who asked not to be identified because the negotiations are private.

Another person briefed on the talks said that despite reports to the contrary, Nissan Motor Co. is still involved in the discussions, although Chrysler's majority owner, Cerberus Capital Management LP, would prefer GM as a single buyer.

That person also spoke on condition of anonymity because the talks are confidential.

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GMAC seeks bank status for rescue funding

Report: Auto finance company wants access to $700 billion bailout

WASHINGTON - GMAC, the auto finance and mortgage company, is seeking to become a bank holding company in order to access the government’s $700 billion financial rescue plan, the Wall Street Journal reported on Tuesday.

GMAC spokesman Gina Proia said the finance company had no comment on the report.

Cerberus Capital Management, the private equity firm that also controls Chrysler LLC, has been discussing the matter with the U.S. Federal Reserve for over a month, the newspaper reported, quoting unnamed people familiar with the talks.

As a bank holding company, GMAC could receive equity injections from Treasury Department and sharply reduce its borrowing costs in part by gaining access to the Fed’s discount window.

Proia said earlier on Tuesday that GMAC LLC had been granted approval by the Fed to use a commercial paper funding facility created earlier by this month by the central bank.

Cerberus and General Motors Corp have been discussing a merger deal for Chrysler since September, according to people familiar with the talks.

The Wall Street Journal said that those talks were being structured so that both GM and Cerberus could benefit from the financial support being offered by the Treasury Department and the Federal Reserve.

The newspaper said that while the mechanics of a bank registration would be complex for GMAC it might include a requirement that GM’s stake in GMAC be no more than 24.9 percent.

Cerberus owns 51 percent of GMAC. GM owns the remainder. In addition to a merger of GM and Chrysler’s struggling auto operations, the two sides have also discussed a transfer of some of GM’s stake in GMAC to Cerberus, people with knowledge of the talks have said.

The newspaper said that one idea being discussed would merge Chrysler Financial into the entity controlled by the bank holding company in order to create a financial services company that would offer services including auto loans, interest bearing accounts and credit cards.

GM and Chrysler have declined to comment since word of their merger talks broke earlier this month.

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GMAC seeks bank status for rescue funding

Report: Auto finance company wants access to $700 billion bailout

WASHINGTON - GMAC, the auto finance and mortgage company, is seeking to become a bank holding company in order to access the government’s $700 billion financial rescue plan, the Wall Street Journal reported on Tuesday.

GMAC spokesman Gina Proia said the finance company had no comment on the report.

Cerberus Capital Management, the private equity firm that also controls Chrysler LLC, has been discussing the matter with the U.S. Federal Reserve for over a month, the newspaper reported, quoting unnamed people familiar with the talks.

As a bank holding company, GMAC could receive equity injections from Treasury Department and sharply reduce its borrowing costs in part by gaining access to the Fed’s discount window.

Proia said earlier on Tuesday that GMAC LLC had been granted approval by the Fed to use a commercial paper funding facility created earlier by this month by the central bank.

Cerberus and General Motors Corp have been discussing a merger deal for Chrysler since September, according to people familiar with the talks.

The Wall Street Journal said that those talks were being structured so that both GM and Cerberus could benefit from the financial support being offered by the Treasury Department and the Federal Reserve.

The newspaper said that while the mechanics of a bank registration would be complex for GMAC it might include a requirement that GM’s stake in GMAC be no more than 24.9 percent.

Cerberus owns 51 percent of GMAC. GM owns the remainder. In addition to a merger of GM and Chrysler’s struggling auto operations, the two sides have also discussed a transfer of some of GM’s stake in GMAC to Cerberus, people with knowledge of the talks have said.

The newspaper said that one idea being discussed would merge Chrysler Financial into the entity controlled by the bank holding company in order to create a financial services company that would offer services including auto loans, interest bearing accounts and credit cards.

GM and Chrysler have declined to comment since word of their merger talks broke earlier this month.

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Cerberus and Mr. Invisible-Stephen Feinberg

The founder of Cerberus Stephen Feinberg is one of the most elusive men in America. Hardly any photos can be found of him! Try and find some! Good luck!


See more Car Pictures at CarSpace.com

Since graduating from Princeton 25 years ago, Feinberg has never given an interview and has never been photographed by the press.

Not that there has been much demand until now. On Wall Street, the C.E.O. of Cerberus Capital Management, an investment firm with $26 billion in assets under management, has long been admired. (“You probably think you’re smart,” says one former employee. “Now take your brain and mine, take them to the 28th power, and you have Steve Feinberg.”)

To the general public, though, Cerberus has been just another shadowy buyer of companies in an already overpopulated field. The firm’s purchases include a grab bag of brands that lurk on the edge of consumer consciousness: Fila sporting goods, Mervyn’s department stores, Alamo and National rental cars, Air Canada, the GMAC lending arm of General Motors.


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Cerberus and Mr. Invisible-Stephen Feinberg

The founder of Cerberus Stephen Feinberg is one of the most elusive men in America. Hardly any photos can be found of him! Try and find some! Good luck!


See more Car Pictures at CarSpace.com

Since graduating from Princeton 25 years ago, Feinberg has never given an interview and has never been photographed by the press.

Not that there has been much demand until now. On Wall Street, the C.E.O. of Cerberus Capital Management, an investment firm with $26 billion in assets under management, has long been admired. (“You probably think you’re smart,” says one former employee. “Now take your brain and mine, take them to the 28th power, and you have Steve Feinberg.”)

To the general public, though, Cerberus has been just another shadowy buyer of companies in an already overpopulated field. The firm’s purchases include a grab bag of brands that lurk on the edge of consumer consciousness: Fila sporting goods, Mervyn’s department stores, Alamo and National rental cars, Air Canada, the GMAC lending arm of General Motors.


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Who Is Cerberus Capital Management and Steve Feinberg?

Cerberus Capital Management, L.P. is one of the largest private equity investment firms in the United States. The firm is based in New York City, and run by 48-year-old financier Steve Feinberg. Former U.S. Vice President Dan Quayle has been a prominent Cerberus spokesperson and runs one of its international units.

Founded in 1992, Cerberus (named for the legendary three-headed dog in Greek mythology that guarded the gates of Hades) invests primarily in companies which are near bankruptcy in the hope of making the businesses it acquires profitable. Feinberg has stated to his employees that while the Cerberus name seemed like a good idea at the time, he later regretted naming the company after the mythological dog.[1]

The company has been a very active acquirer of businesses over the past several years and now has sizable investments in sportswear, paper products, military services, real estate, energy, retail, glassmaking, transportation, and building products. In 2006, its holdings amounted to $24 billion. While many of its peers have bought out companies in order to strip assets and sell on for a profit, Cerberus builds its reputation on identifying firms that are undervalued, and assisting in rejuvenating them by working with current management.[1]

On October 19, 2006, John W. Snow, President George W. Bush's second United States Secretary of the Treasury, was named chairman of Cerberus.






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Who Is Cerberus Capital Management and Steve Feinberg?

Cerberus Capital Management, L.P. is one of the largest private equity investment firms in the United States. The firm is based in New York City, and run by 48-year-old financier Steve Feinberg. Former U.S. Vice President Dan Quayle has been a prominent Cerberus spokesperson and runs one of its international units.

Founded in 1992, Cerberus (named for the legendary three-headed dog in Greek mythology that guarded the gates of Hades) invests primarily in companies which are near bankruptcy in the hope of making the businesses it acquires profitable. Feinberg has stated to his employees that while the Cerberus name seemed like a good idea at the time, he later regretted naming the company after the mythological dog.[1]

The company has been a very active acquirer of businesses over the past several years and now has sizable investments in sportswear, paper products, military services, real estate, energy, retail, glassmaking, transportation, and building products. In 2006, its holdings amounted to $24 billion. While many of its peers have bought out companies in order to strip assets and sell on for a profit, Cerberus builds its reputation on identifying firms that are undervalued, and assisting in rejuvenating them by working with current management.[1]

On October 19, 2006, John W. Snow, President George W. Bush's second United States Secretary of the Treasury, was named chairman of Cerberus.






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Cerberus Isn't Seeking GM Management Changes in Chrysler Merger

By Mike Ramsey

Oct. 25 (Bloomberg) -- Chrysler LLC owner Cerberus Capital Management LP isn't seeking to remove General Motors Corp. leaders including Chief Executive Officer Rick Wagoner in a merger of the automakers, a person familiar with the talks said.

Cerberus also wants a ``meaningful'' stake, not a majority, in a combined company, said the person, who asked not to be identified because the negotiations are private. It's too early to say whether the New York-based buyout firm would have board representation, the person said.

Wagoner, 55, is the longest-serving CEO at a U.S. automaker, after taking the top spot at Detroit-based GM in 2000. Alan Mulally joined Ford Motor Co. in 2006, and Robert Nardelli was hired at Chrysler last year. The person declined to comment on Nardelli's role, if any, in a GM-Chrysler merger.

``GM has good management,'' said Laurie Harbour-Felax, president of consulting firm Harbour-Felax Group in Berkley, Michigan. She questioned whether Cerberus ``could force a change.''

Cerberus has been in talks with GM and Nissan Motor Co. on a sale, merger or alliance involving Auburn Hills, Michigan- based Chrysler, whose 25 percent U.S. sales decline through September is the steepest among major automakers. GM's sales slide is 18 percent this year, and the biggest U.S. automaker has posted almost $70 billion in losses since 2004.

GM and Cerberus are targeting month's end to complete a deal, while Cerberus and Tokyo-based Nissan also have exchanged proposals, according to people familiar with the matter.

Spokesmen for GM, Chrysler and Cerberus haven't confirmed that the companies are in talks. Cerberus bought 80.1 percent of Chrysler from Daimler AG in 2007, and is negotiating to acquire the rest.

Chrysler's Losses

The shrinking U.S. auto market is ramping up pressure for Chrysler to find savings and stem losses that the company indicated had totaled more than $1.08 billion through the first half. The third-largest U.S. automaker has said it had $11.7 billion in cash at the end of June.

Chrysler said yesterday it would eliminate 25 percent of its salaried workforce, or about 4,300 jobs, by the end of the year, and trim capital spending on everything except its most- important products. That followed the Oct. 23 announcement of 1,825 job cuts at two sport-utility vehicle plants.

Further ``organizational and restructuring'' actions will be taken in the near future, Chrysler said yesterday, without elaborating.

Merger's Logic Questioned

Analysts including Citigroup Global Markets Inc.'s Itay Michaeli have questioned the logic of a GM-Chrysler merger, arguing that it could drag down both automakers before attaining long-term savings.

A combined company would need $10 billion to $12 billion in fresh liquidity, Michaeli wrote in a note to investors on Oct. 20. The New York-based analyst rates GM as ``sell.''

Cerberus may contribute some liquidity to a deal, people familiar with the negotiations have said.

GM also is working to return to profit. The automaker said yesterday that its planned reductions in the salaried workforce will go beyond the 5,000 jobs already targeted and that it will stop contributing to some retirement-savings plans.

GM fell 15 cents, or 2.5 percent, to $5.95 yesterday in New York Stock Exchange composite trading. Since the end of June 2000, the month Wagoner became CEO, the shares have dropped by 90 percent, the worst performance among the 30 companies in the Dow Jones Industrial Average.

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Cerberus Isn't Seeking GM Management Changes in Chrysler Merger

By Mike Ramsey

Oct. 25 (Bloomberg) -- Chrysler LLC owner Cerberus Capital Management LP isn't seeking to remove General Motors Corp. leaders including Chief Executive Officer Rick Wagoner in a merger of the automakers, a person familiar with the talks said.

Cerberus also wants a ``meaningful'' stake, not a majority, in a combined company, said the person, who asked not to be identified because the negotiations are private. It's too early to say whether the New York-based buyout firm would have board representation, the person said.

Wagoner, 55, is the longest-serving CEO at a U.S. automaker, after taking the top spot at Detroit-based GM in 2000. Alan Mulally joined Ford Motor Co. in 2006, and Robert Nardelli was hired at Chrysler last year. The person declined to comment on Nardelli's role, if any, in a GM-Chrysler merger.

``GM has good management,'' said Laurie Harbour-Felax, president of consulting firm Harbour-Felax Group in Berkley, Michigan. She questioned whether Cerberus ``could force a change.''

Cerberus has been in talks with GM and Nissan Motor Co. on a sale, merger or alliance involving Auburn Hills, Michigan- based Chrysler, whose 25 percent U.S. sales decline through September is the steepest among major automakers. GM's sales slide is 18 percent this year, and the biggest U.S. automaker has posted almost $70 billion in losses since 2004.

GM and Cerberus are targeting month's end to complete a deal, while Cerberus and Tokyo-based Nissan also have exchanged proposals, according to people familiar with the matter.

Spokesmen for GM, Chrysler and Cerberus haven't confirmed that the companies are in talks. Cerberus bought 80.1 percent of Chrysler from Daimler AG in 2007, and is negotiating to acquire the rest.

Chrysler's Losses

The shrinking U.S. auto market is ramping up pressure for Chrysler to find savings and stem losses that the company indicated had totaled more than $1.08 billion through the first half. The third-largest U.S. automaker has said it had $11.7 billion in cash at the end of June.

Chrysler said yesterday it would eliminate 25 percent of its salaried workforce, or about 4,300 jobs, by the end of the year, and trim capital spending on everything except its most- important products. That followed the Oct. 23 announcement of 1,825 job cuts at two sport-utility vehicle plants.

Further ``organizational and restructuring'' actions will be taken in the near future, Chrysler said yesterday, without elaborating.

Merger's Logic Questioned

Analysts including Citigroup Global Markets Inc.'s Itay Michaeli have questioned the logic of a GM-Chrysler merger, arguing that it could drag down both automakers before attaining long-term savings.

A combined company would need $10 billion to $12 billion in fresh liquidity, Michaeli wrote in a note to investors on Oct. 20. The New York-based analyst rates GM as ``sell.''

Cerberus may contribute some liquidity to a deal, people familiar with the negotiations have said.

GM also is working to return to profit. The automaker said yesterday that its planned reductions in the salaried workforce will go beyond the 5,000 jobs already targeted and that it will stop contributing to some retirement-savings plans.

GM fell 15 cents, or 2.5 percent, to $5.95 yesterday in New York Stock Exchange composite trading. Since the end of June 2000, the month Wagoner became CEO, the shares have dropped by 90 percent, the worst performance among the 30 companies in the Dow Jones Industrial Average.

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GM-Chrysler merger and Cerberus--Very Little Options!

RPT-DEALTALK-Options scarce if GM-Chrysler merger talks fail

DETROIT, Oct 22 (Reuters) - As General Motors Corp (GM.N: Quote, Profile, Research, Stock Buzz) pushes ahead with talks to acquire Chrysler LLC, uneasy suppliers and workers are bracing for a deal that would combine two struggling automakers and cost tens of thousands of jobs.

But as GM struggles to line up financing for an acquisition, attention has turned to an even more uncertain prospect: What happens if the controversial deal falls apart?

For Chrysler, owned for the past year by Cerberus Capital Management, the options are dwindling, according to bankers, consultants and experts on corporate strategy.

If GM pulls out, people briefed on the talks expect Cerberus to seek another buyer for the maker of Jeep, Dodge and Chrysler models. Failing that, Cerberus would likely look to break up Chrysler and sell whatever assets it could, they said.

"Selling off assets will only become strategy if GM is off the table and they have not found any other buyer," said one person familiar with the matter, who estimated the GM deal now has about a 1-in-3 chance of success because of difficulties in securing outside funding.

Another person familiar with Chrysler's planning said the automaker had drawn up scenarios that would involve selling key assets like the Jeep brand, its specialty parts business Mopar and even its engineering operations if Cerberus is pushed to break up the 80-year-old automaker.

Both GM and Chrysler have declined to comment when questioned about the merger talks. Both automakers have also ruled out bankruptcy as an option as they restructure......Read More

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