Stuttgart, Germany – Daimler AG has redeemed its 19.9 per cent stake in Chrysler, and will collaborate solely on a supplier-customer basis. Daimler, Chrysler, Cerberus and the U.S. Pension Benefit Guaranty Corporation signed a binding term sheet on April 27 covering issues still pending between the parties in connection with Chrysler.
Under the agreement, Daimler’s 19.9 per cent shareholding in Chrysler will be redeemed, and the German automaker will forgive repayment of the loans extended to Chrysler, which were already written off in the 2008 financial statements.
In addition, Daimler has agreed to pay US$200 million into Chrysler’s pension plans on the date of the execution of the agreements, and in each of the next two years. This will help to secure pension payments to former employees of DaimlerChrysler.
Chrysler and Cerberus have waived any claims that might arise from representations and warranties made in the transaction of August 3, 2007, including accusations the company made against Daimler in 2008 that alleged improperly managed issues between the agreement signing and the transaction conclusion, and an accusation that incomplete information was provided on the transaction.