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article imageGM Denies Report Claiming Chrysler Merger Talks Reopened

By Chris Hogg     Dec 18, 2008 in Business
According to a report, two of the big three are back at the table discussing a merger. Merger talks were reopened after Cerberus Capital Management LP, owner of Chrysler, said it would be willing to give away part of its ownership of the company.
The report in Thursday's Wall Street Journal (subscription required) cites people familiar with the talks as the source. They say Cerberus re-initiated the merger talks, as both companies are struggling with cash problems.
General Motors denies the report saying it is untrue. According to an AP report, Spokesman Tony Cervone says GM's stance on the merger talks has not changed since it suspended talks with Chrysler last time around.
Previous talks between the two auto giants fell apart after both said a merger was impractical and it was distracting them from liquidity issues.
Yesterday, Chrysler also made a surprise announcement that it would be closing all of its plants for at least one month to save cash.
The Wall Street Journal said Cerberus wants to be more flexible with ownership possibilities in an effort to combine financial divisions of both GM and Chrysler. Cerberus is reportedly trying to "protect its majority investments in GMAC, in which it holds a majority stake, and Chrysler's Chrysler Financial unit."
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