Chrysler bids due today
TEXT OF STORY
LISA NAPOLI: If you don’t want to buy a struggling media empire, how about a struggling automaker? Initial offers to buy Chrysler are due today and Marketplace’s Amy Scott takes a look at the possible candidates.
AMY SCOTT: Media reports have named a number of potential buyers.
Private equity funds Blackstone and Cerberus are among them. So is General Motors, though some say GM has backed off recently. Canadian auto parts maker Magna may be another contender.
Analyst Brett Hoselton follows Chrysler for KeyBanc Capital Markets. He says any buyer would need to shrink Chrysler’s labor costs to profit from the deal, and that means negotiating with the United Auto Workers.
BRETT HOSELTON: While there’s a certain amount of value in Chrysler, that value is fairly small unless you can get some concessions from the UAW.
Union officials oppose a private equity deal for fear of massive job cuts, and they have some say in the matter. German law requires that a company’s supervisory board approve such a sale. And union reps hold half the board’s seats.
In New York, I’m Amy Scott for Marketplace.
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