Merger Talks in the Works
Merger Talks in the Works Save Email Print
Posted: 9:47 PM Oct 11, 2008
Last Updated: 9:47 PM Oct 11, 2008

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DETROIT (AP) -- General Motors and chief Chrysler stakeholder Cerberus are said to be holding preliminary talks about some sort of merger.

That's according to a person familiar with the discussions.

Industry analysts say in order to pull it off, GM would have to get desperately needed cash. Both automakers are struggling to survive amid slumping sales, the slowing global economy and the unprecedented credit crunch.

A tie-up between the automotive giants would solidify GM's position as the global sales leader. One authority on mergers and acquisitions says if the numbers work, a lean, merged automaker would be in a strong position to make money once the market recovers and people start buying cars again.

The Wall Street Journal reports that Cerberus might trade Chrysler for GM's 49 percent stake in GMAC Financial Services. Cerberus already owns 51 percent of GM's former financial arm.

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