Spokespeople for both Cerberus and Chrysler Corp. as well as Lee Iacocca himself have assured the press, that Chrysler is not looking to go Chapter 11.
This comes shortly after Chrysler drew on it’s available $2 billion line of credit. Issued by Daimler, and Cerberus management, it gave Chrysler a loan at just 7 points above prime.
This is a significant move, as Chrysler lost $1.6 billion in 2007, yet managed to keep over $9 billion in cash.
Fitch Ratings cut Chrysler and GM in it’s review, as both face serious problems in their business.
It is believed that there have been talks about a possible spinoff of Chrysler from Cerberus Financial, although Cerberus denies these allegations.
