GM denies holding new merger talks with Chrysler
NEW YORK (Reuters) – General Motors Corp has not reopened merger talks with Chrysler LLC, a GM spokesman said on Thursday, denying a report in The Wall Street Journal that talks had been revived. “We have had no talks with them since we announced during our third-quarter earnings call that the talks had been suspended,” GM spokesman Tony Cervone said.
Representatives for Chrysler and Cerberus Capital Management, which owns an 80 percent stake in Chrysler, did not return calls seeking comment on the Journal report. GM and Cerberus suspended talks in late October. GM had pushed for up to $10 billion in U.S. government aid to support an acquisition of Chrysler, according to sources with knowledge of the talks. The discussions were dropped when no financing was immediately available.
The Bush administration is considering using funds from the $700 billion financial industry rescue to bail out the Big Three U.S. automakers. A proposed $14 billion bailout collapsed in Congress in the face of opposition from Senate Republicans. Analysts have said GM and Chrysler could face bankruptcy without quick help. GM has said it needs at least $4 billion by the end of December. The chief executives of GM and Chrysler told the Senate Banking Committee during hearings for financial aid earlier this month that they would consider restarting merger talks if needed.
(Reporting by Jui Chakravorty Das; editing by John Wallace)