German firm forgives Chrysler's outstanding loans
28 April 2009

Daimler has given up its 19.9 per cent stake in Chrysler, finally splitting all ties with the ailing US manufacturer.

Daimler has agreed to forgive all of Chrysler’s outstanding loans; it previous sold an 80.1 per cent stake in the company to private equity firm Cerberus in 2007.

Chrysler is struggling to restructure before 30 April in order to secure further loans from the US government.

It has announced a cost-cutting deal with its main US union in a bid to stop losses.

Daimler reportedly relinquished its stake after settling a dispute with Cerberus over the transaction two years ago.

Under the deal Daimler will also reportedly pay $600 million into Chrysler's pension plans in three installments.

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