General Motors offered Daimler Chrysler no cash in its bid to acquire the struggling Chrysler Group from the German-American automaker, according to a new report citing people familiar with the proposal. GM did offer Daimler a small stake in GM stock, but also asked that the Germans pay it to take Chrysler off their hands.
According to a story published by the Detroit News today, General Motors offered to pay Daimler nothing for Chrysler , Dodge , and Jeep , and actually wanted more than $1 billion to help defray Chrysler’s health care costs.
GM said it would give Daimler a stake of less than 10 percent in GM stock. Assuming GM offered an eight percent stake, that would equate to roughly $1.44 billion in stock. Considering GM wants Daimler to pay it more than a billion dollars, GM would be paying Daimler next to nothing ($200-$500 million) for Chrysler.
The details of this offer make a proposal by Canadian auto parts supplier Magna sound more reasonable. As previously reported, the company has offered $4.7 billion to buy the Chrysler Group. Analysts value Chrysler anywhere between nothing and $13 billion. While Magna’s offer is viewed as low, it is considerably more generous than the one presented by GM.
Daimler-Benz paid $36 billion in 1998 to acquire Chrysler.
