Chrysler Unions To Fight Sale

NEW YORK, March 18, 2007; Reuters reported that union leaders on both sides of the Atlantic are vowing to fight a sale of DaimlerChrysler AG's Chrysler Group to a private-equity buyer, throwing a potential hurdle in front of a deal, according to a report in The Wall Street Journal.

The opposition comes as Cerberus Capital Management LLC is piecing together a team of auto-industry veterans headed by former Chrysler executive Wolfgang Bernhard to bolster its expected bid for the U.S. unit, people familiar with the matter said in the Journal.

Cerberus, the tandem of private-equity groups Blackstone Group and Centerbridge Partners LP, and Canadian supplier Magna International Inc. have met with Chrysler executives and begun reviewing financial and product-development information. They are expected to present proposals by month's end.

The union sentiment raises the potential for a push by labor to block any deal that would involve deep cuts of union jobs, the Journal noted.

Blackstone, Centerbridge and Magna have begun meeting labor leaders in hopes of breaking down opposition before bids are submitted, people familiar with the matter said in the Journal.