Report: Chrysler buyers could emerge by the end of March
Potential Chrysler Group buyers could present offers for the struggling car maker as soon as the end of this month, the Wall Street Journal reports today.
Private equity firms including Cerberus Capital Management LLC, Blackstone Group and Centerbridge Partners LP met with Chrysler management last week, signing confidentiality agreements so they could review detailed financial and product information.
Canadian parts supplier Magna International Inc. also has expressed interest in Chrysler.
Chrysler parent DaimlerChrysler AG hopes to have a short list of potential buyers by its general shareholders meeting in Berlin on April 4, the Journal said.
2 equity firms are top contenders to buy Chrysler Group, analyst saysMagna International Inc., a Canadian auto supplier that had been talking with the Chrysler Group, was less likely to make a bid because it placed a lower value on the Chrysler Group, the KeyBanc report said.
?While we believe MGA remains interested in taking significant action toward Chrysler (alliance, partnership or minority stake), our sources indicate the likelihood of such actions is now much reduced,? KeyBanc analyst Brett Hoselton wrote in the report.
Magna Chairman Frank Stronach met with Chrysler Group CEO Tom LaSorda on March 9, according to the report.
Magna showed interest in forming a partnership with a private equity firm. Magna would run the Chrysler Group facilities while the private equity group would put up most of the money as the majority investor.
Magna, though, values the Chrysler Group at about $4 billion, the KeyBanc report says. Private equity buyers have valued the Auburn Hills unit at about $5 billion, it said.
?Our sources have indicated that Cerberus and Blackstone have emerged as the leading contenders to acquire Chrysler and that due to valuation issues MGA is now playing a smaller role in the sale process,? Hoselton wrote in the report.
Cerberus and Blackstone, private equity firms that already have ties to the auto industry, reportedly met with Chrysler Group officials last week in Auburn Hills.
These firms, which have billions of dollars in investment money, specialize in buying troubled companies and attempting to turn them around to make a profit.
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