June 03, 2008

Cerberus Off Loading Chrysler

Rumors abound, it was reported that Cerberus has sold a boatload of it's stock in Chrysler.

Cerberus vehementally denies this.

Cerberus Capital Management LP denied reports Monday that it had sold equity stakes in Chrysler LLC or GMAC -- but didn't deny it had sought new money from its investors.

The Financial Times had reported that Cerberus sold more than half of its equity stake in the two companies for more than $1 billion to 90 outside investors.

"Cerberus has not reduced or made any changes to its equity stakes in GMAC or Chrysler since the closing of either transaction," said a Cerberus statement released Monday. "Cerberus continues to have voting control over both investments. It is common knowledge, and has been widely reported, that Cerberus made these investments side-by-side with its co-investors at the time of closing. Our commitment to these companies has not changed."

If there is one thing that people who have worked in the automotive business long enough it that when a company vehementally denies something it usually is true.

The truth may take a few months to come out, but I betting that this is true and by the end of summer we will find out.

Posted by Quality Weenie at June 3, 2008 07:26 AM | TrackBack