Cerberus Capital Management is now willing to give up partial ownership in Chrysler, which has spurred a renewal of merger talks between it and General Motors, Heidi N. Moore and Jeffrey McCracken
report this morning. Cerberus took the initiative to restart the discussions.
Congress has pressed Cerberus to pump more money into Chrysler but it has thus far refused, saying the
shareholders of its rivals aren't being asked to do the same and that its investment charter prohibits such a move. But it might give away some of its principals' stakes in Chrysler as part of a
broader restructuring, giving an auto czar discretion to distribute Cerberus' stake to the United Auto Workers union or even to GM.
"Layered on top of these complex discussions is the
fate of GM's former finance unit, GMAC, in which Cerberus holds a majority stake. It also controls Chrysler's Chrysler Financial unit. Part of Cerberus' strategy, say people briefed on the matter, is
to protect its majority investments in these two units," Moore and McCraken write.
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