Business Case Studies, Mergers, Acquisitions and Takeovers Case Study, Cerberus,New Era for Chrysler

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Mergers, Acquisitions and Takeovers Case Study

Case Title:

The Cerberus Deal – The Beginning of a New Era for Chrysler

Publication Year : 2008

Authors: Sheeja.S, Lekha Ravi

Industry: Automobiles


Case Code: MAA0163C

Teaching Note: Available

Structured Assignment: Available

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US automobile giant, Chrysler had joined hands with German automaker, Daimler –Benz in a much touted ‘Merger of Equals’ in 1998. Shortly after, Chrysler suffered severe financial crisis and eventually both the companies opted for a divorce. Daimler had been looking to offload Chrysler to a suitable proposer and in August 2007, sold 80.1% of its stock in Chrysler to an American Private Equity firm, Cerberus. Will Cerberus be able to bail Chrysler out of troubled waters?

Pedagogical Objectives:

  • To study the dynamics of the US auto industry
  • To analyse the causes for the fall out of Merger of equals
  • To study the challenges faced by a Private firm in acquiring a Public company.

Keywords : US auto Industry; Daimler Chrysler Merger; mergers of Unequals; unhappy marriage; Cereberus; Mergers,Acquisitions,Alliances Case Studies; Chrysler; new Era; Prospects and challenges

Contents : 
Chrysler Inc.: The Divorce from Daimler
Challenges of the DaimlerChrysler Merger
Chrysler’s Declining Earnings
Acquisition of Chrysler by Cerberus: The New Vows
DaimlerChrysler’s Takeover Chronology
Challenges Behind the MoE
Company Profile of Cerberus Capital Management
Analysts’ Opinion on the Merger between Chrysler and Cerberus

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