U.S. News

Cerberus Top Contender for Chrysler, Reports Say


Private equity firm Cerberus Capital Management may be the top contender to buy control of DaimlerChrysler's struggling Chrysler Group, though other bidders remained in the mix, according to newspaper reports.

Cerberus has been holding extensive discussions with Chrysler's parent, Germany's DaimlerChrysler , The Detroit News and The Wall Street Journal reported, citing anonymous sources they described as familiar with the talks.

Among the other companies reportedly interested in Chrysler are Canadian auto parts supplier Magna International, a consortium of investors led by Blackstone Group and General Motors. Billionaire investor Kirk Kerkorian, who tried to take control of Chrysler in the 1990s, also has said he would make a bid.

Aurora, Ontario-based Magna is flush with a $1.54 billion infusion from privately held Russian industrial conglomerate Basic Element, a move announced Thursday that many saw as an effort to bolster Magna's position to acquire Chrysler. Magna also appears to be the favorite of Chrysler's powerful unions, which control just less than half the votes on parent company DaimlerChrysler's supervisory board.

Spokesmen for DaimlerChrysler, Cerberus and Magna declined to comment Saturday.

Chrysler lost $1.5 billion in 2006 and is undergoing a recovery plan that will cut 13,000 jobs in Canada and the United States and pare back production. DaimlerChrysler announced in February that all options for Chrysler are on the table, including a sale.