You Say 'Takeover.' I Say 'Merger of Equals.'

The latest on the lawsuit in the New York Times.
Great article.
http://www.nytimes.com/2003/12/21/business/yourmoney/21trial.html
Excerpted:
Testimony in the trial was expected to conclude
last week but was thrown off course when DaimlerChrysler turned over 61 pages of notes written by former top Chrysler executives during the transaction.
The notes were sealed, though a few scraps emerged in court proceedings, including bullet points like "loss of independence" and "senior management sold out."
DaimlerChrysler's lawyers have suggested that Mr. Kerkorian's claim borders on the absurd. They said that the terms of the deal had been spelled out clearly in writing in an agreement disclosed to shareholders and that Mr. Kerkorian had an insider's view of the transaction through his representative on Chrysler's board.
Yet the Chrysler executives, Mr. Eaton included, also said that they stood by the deal. "I believe it was a merger of equals," Thomas T. Stallkamp, the former president of the Chrysler Group, said at the trial. He was forced out of Chrysler the year after the merger.
But was it a merger of equals? At the trial, Mr. Schrempp called that description "absolutely correct."
"And by telling the truth," he added, "I don't think I can defraud anyone."
Further, he argued, the terms of the contract laid out a division of management for a set period of a few years, and that condition was met; beyond that, he said, no company can permanently cede the right to make management changes.
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This has been a great trial, I've been following it all along. As a former Chrysler/DCX Employee my curiosity gets the best of me. I quit in 98 shortly after the merger because the German rule sucked ass.They came over an wanted all the info they could get from us, but when we asked questions of them or wanted them to hand over some stuff, refused, and if we kept insiting, sometime worse than just a nasty e-mail. I was in the IT group, they wouldn't tell us shit about how they put together thier CAD systems..but they sure came over and demanded many reports from us on how we did it. I have/had many friend in other groups, the tranmission group was simply curious about some of Daimlers vast history of building transmissions..(as well we should be curious of others trans designs, whoever designed the A604 should be put in gitmo, and whoever descision it is to keep using it to this day, should be shot), The diesel engine guys were worried when the cummins deal was about to run out, so they wanted some Daimler diesel tips, why not, Daimler has been building diesel engines for decades. Did they get them, hell no, all they got was addition spy software put on thier machines, I should know, I was one of the ones forced to put it there.
This deal stunk from the second it was announced. BUT, the bottom line here, in the trial, is everybodies right. The top execs DID sell out. The merger was not a merger, it was a sellout. Mr Schrempp is right too, all the terms of the aggreement have been met. What I want to see in this trial, which I havn't seen yet, is where did all the cash go? At the beginning of '98 Chrysler had almost $1,000,000,000 (billion) in CASH! Anticipating, what they all testified, was to be a hard few years to come. That CASH was GONE at the end of the merger, and suddenly, the "Chrysler" divsion is doing poorly, well, we'll have to cut some research programs...some jobs....(don't worry, being in IT, I quit when the handwriting was on the wall, and the IT market is still good!)... There is no winner here either, if DCX has to fork over billions to Kerkorian, that will be the death of alot of people in Auburn Hills. No one in Germany will fret. If DCX wins, everyone will still thing the deal stinks, because it does, do what to do, what to do..
greek_philosophizer wrote:

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