Daimler will give up its 19.9% stake in Chrysler

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Yesterday Chrysler and Daimler finally agreed on that Daimler will let go of its remaining 19.9 percent stake in Chrysler and will also write off a $1.5 billion loan that it gave Chrysler in 2007.

That $1.5 billion loan was already written off in Daimler’s 2008 financial statement so Chrysler has been pretty much worthless to Daimler for a while.

In addition, Daimler has agreed to pay US $200 million into Chrysler’s pension plans on the date of the execution of definitive agreements and in each of the next two years. In this way, Daimler is helping to secure pension payments to former employees of DaimlerChrysler.

Chrysler is racing the time as it has to come up with a restructure plan by April 30th. We’ll see soon what the future brings to Chrysler with or without its new partner Fiat.

Source: Daimler