Tuesday, July 24, 2007

Chrysler eager to seal sale in week

As changing of signage begins, Aug. 1 party is in the works

As lawyers from Cerberus Capital Management and DaimlerChrysler AG push to complete their Chrysler deal, officials at the Auburn Hills automaker are beginning to remove "Daimler" from some signs and are making plans for a celebration next week.

The deal to wrap up Cerberus' acquisition of Chrysler could occur Monday or Tuesday of next week, with a celebration tentatively planned for Aug. 1 at Chrysler's Auburn Hills headquarters, people familiar with the planning told the Free Press.

They cautioned, however, that the exact date remains uncertain because of the army of lawyers employed by both Chrysler's current parent, DaimlerChrysler, and its soon-to-be owner, Cerberus.

No major issues are expected to arise, they add, but crossing all of the T's and dotting all of the I's could take a little longer than expected.

Meanwhile, the signs at Auburn Hills headquarters are already being changed. "Daimler" was removed in recent days from an external granite sign at the Technical Center building, for example.

Frank Ewasyshyn, Chrysler executive vice president for manufacturing, said the changeover of signs will be gradual, in large part to save money.

He noted that the large signs at Chrysler's plants can cost about $30,000 apiece, putting aside the costs of all the smaller DaimlerChrysler signs throughout buildings. Chrysler has about 30 production facilities in North America.

"We're not going to do a big Day One sign thing. We'll get them cleaned up as time goes on," Ewasyshyn said last week. "There is a lot of signage. They're not cheap."

Cerberus officials have said they want to close the deal in the third quarter. One factor that could be pushing the deal to completion next week is a traditional German summer vacation period during the first part of August.

On Friday, Chrysler Chief Executive Officer Tom LaSorda said the deal was close to being done.

"We're very, very close," he said. "The commitments are there from the banks."

Peter Duda, a spokesman for Cerberus, declined comment Monday beyond emphasizing the stated goal of a third-quarter closing. A DaimlerChrysler spokesmen declined comment.

Bill Golling, CEO of Golling Chrysler Jeep Dodge Inc. in Bloomfield Hills, said he has been told the closing could come as late as Aug. 15.

"I think it's good that we're going to become a U.S. company again; I think that it is good that we're with somebody that wants us," he said.

The cost of becoming a U.S. company free of Daimler comes with costs. Signs, stationery, business cards and everything else branded with DaimlerChrysler AG will need to change.

"To me it's another chapter. It's an opportunity to do things that we've never been able to do," Ewasyshyn said.

In May it was announced that Cerberus, a private equity firm, would spend $7.4 billion to acquire 80.1% of Chrysler. DaimlerChrysler, which plans to drop the word Chrysler from its name in the near future, will keep 19.9% of the American company.

Chrysler and Daimler, officials say, will continue with some sharing.

Chrysler's new official name has not been announced. A memo from a senior Chrysler executive obtained shortly after the May announcement said the Chrysler Pentastar is being brought back as the corporate logo, something the company has not commented on officially.

The DaimlerChrysler breakup comes after nine years. The original merger cost Daimler-Benz AG about $36 billion in 1998.

The beginning of the merger was a huge event, costing tens of millions for the Day One celebration, according to people who remember the day.

The event being planned for Aug. 1 in Auburn Hills will be much quieter, company officials insist.

Big party or not, Chrysler workers are eager for their company to be a stand-alone automaker again.

"They're glad it's going to be a U.S. company and getting rid of the Daimler on the name," Gerry Dettling, 48, of Clarkston, who fabricates prototype parts for Chrysler, told the Free Press earlier this summer.

Added Chrysler worker Steve McCaffrey, 40, of Wixom: "Everybody is saying we're getting our name back. It will be exciting to see what happens."

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