Cerberus Committed to Chrysler, Confident of Funding
ROCHESTER, MICH—Cerberus Capital Management LP is "confident"; it has the financing to close the US $7.4-billion acquisition of Chrysler Group this month.

ROCHESTER, MICH—Cerberus Capital Management LP is "confident" it has the financing to close the US $7.4-billion acquisition of Chrysler Group this month and is committed to turning around the loss-making automaker, the chairman of the private equity firm said July 11, according to Reuters.
"We're committed to Chrysler. We're committed to making it an enormous success," Cerberus Chairman John Snow said to an audience of about 700 at the Detroit Economic Club.
Cerberus agreed to buy 80.1 percent of DaimlerChrysler AG's U.S unit in May.
Snow, who served as U.S. Treasury Secretary for three years until last June, also said Cerberus supported the present management team at Chrysler and its turnaround plan.
"We admire (Chrysler Chief Executive) Tom LaSorda and his management team ... We like the products they're developing," he said.
Chrysler's major unions, the United Auto Workers and the Canadian Auto Workers, have endorsed the Cerberus acquisition, and Snow said Cerberus wanted to maintain a cooperative relationship with both.
"We are not naive. We know the course ahead will be difficult," he said in his prepared remarks. "However, we are confident we can meet the challenge. We believe in the future of the U.S. manufacturing industry ... and we believe in the future of the U.S. auto industry and Chrysler in particular."
Snow said Cerberus would leave a crucial round of contract talks set to start this month with the UAW to Chrysler's management team.
It was too early to comment on whether the investment firm would look to merge former GM financial arm GMAC and Chrysler Financial.
"That's something that can be addressed down the road," he said. Cerberus acquired a 51 percent stake in GMAC from GM last year as the No. 1 U.S. automaker sold off assets to raise funds for its own restructuring.
While Snow said Cerberus had anticipated somewhat tougher fuel economy standards from U.S. regulators, he vowed to lobby against enactment of the higher fleet-wide fuel efficiency standards passed by the U.S. Senate.
The Senate legislation would require new autos to average 35 miles per gallon by 2020, a 10 mile-per-gallon improvement over current standards, as a way to reduce consumption and cut U.S. oil imports.
But Snow said those standards would prove impossible to meet and carry "the risk of sinking the U.S. auto industry."
Meeting the proposed fuel economy standards could be especially costly for Chrysler, which relies on sport-utility vehicles such as its Jeep line-up and other light-trucks for over 70 percent of its U.S. sales, a higher percentage than rivals.
The House is working on an energy bill that currently has no fuel economy provision, but key members are expected to try to attach an amendment that would meet or exceed the Senate proposal.
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