Magna first to bid on Chrysler ahead of shareholder meeting

According to Brett Hoselton, an analyst at KeyBanc Capital Markets, Canadian supplier Magna International Inc. together with an unnamed private equity group has already made a bid for the Chrysler Group in the neighborhood of $4.6 to $4.7 billion. Sound a little low for a company the size of the Chrysler Group? It is, because Magna is only going for about 20 to 25% of the company in the hopes it will be able to buy a chunk when other bidders "retreat".

DaimlerChrysler expects that the bid by Magna will not be the last before it convenes in Berlin on April 4 for its annual shareholder meeting. Obviously, discussion of what to do with the Chrysler Group will be the main topic, so being able to enter with a few informal bid offers will likely help DCX CEO Dieter Zetsch frame the issue with an idea of what the Chrysler Group could fetch.

The sale of the Chrysler Group will be an extremely messy affair for many reasons, not the least of which is the UAW, headed by Ron Gettelfinger, who also sits on the DCX supervisory board and has said he doesn't want to see the automaker sold, and if it is, then not into the hands of a private equity group. Our sources deep within the bowels of the Chrysler Group tell us that both salaried and hourly workers would just like this to end, preferably with a sale to another automaker. Many still resent the way in which Daimler-Benz swooped in and dominated this "merger of equals" from day 1.

[Source: Automotive News]

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