The Merger of GM and Chrysler, with help from the U.S. Treasury, would go down in history as one of the stupidest transactions in business annals. At at time of world wide auto over capacity glut, GM is taking on more factories and Union obligations.I understand why the hedge fund Cerberus wants to do the deal. They desperately need to move their ill-timed-overpriced leverage buyout of Chrysler into a more liquid instrument–i.e. GM common stock. They seem so desperate they’ll put more cash into the transaction.
But for GM, it would be the last nail in the coffin. At a time when they desperately need many fewer model and maybe fewer brands (does anybody really miss Oldsmobile?)–GM is taking on the useless muscle cars of Chrysler.
The Bush Administration better talk to Congress before committing Billions of tax payer’s funds to this misbegotten shotgun marriage.