Chrysler's spinoff from its German parent and the subsequent sale to Cerberus Capital Management was announced back in May, but the deal was only given final approval from the European Commission yesterday. Despite the latest episode, we're unlikely to see things finalized until at least the third quarter because the deal now requires approval from U.S. authorities.
Since there were no objections from any of the parties involved, the approval was fast-tracked using a special simplified procedure, and the same approach is expected to be taken on U.S. soil.
Under the terms of the deal, Cerberus will become the owner of an 80.1% stake in Chrysler and its financing businesses. Of the $7.4 billion dollars it's paying for the privilege, $6.05 billion will go towards Chrysler and its finance arm, with $1.35 billion paid into the coffers of Germany's Daimler. In return, Daimler will offer a loan of $405 million to Chrysler and an additional $880 million to cover its long-term liabilities.
[Source: Automotive News - Sub. Req.]
