Chrysler ... bought by the Russians? Say it ain't so . . .
Magna International is a finalist in the buyout bidding for Chrysler and is already making plans on restructuring the lumbering auto giant. Now comes word that a company owned by Russian billionaire Oleg Deripaska will pay $1.54 billion for 20 million shares in Magna. Deripaska is reported to have political connections with Russian President Vladimir Putin but of course that's no surprise. Seems like Presidents of lots of countries have "political connections" with billionaires.
You think you've got trouble with warranty coverage now, just wait 'till the Russians are making the decisions! Nyet may be what you may be hearing on the 800 number sooner than you think!
Okay, so let me see if I've got this right. Americans sold Chrysler to the Germans and now the Germans are ready to sell it to an outfit made up of Russians and Canadians? What gives here?
Looks like Magna apparently wants to get some partners in on its Chrysler deal to spread the risk in case things turn out bad later on. One JP Morgan analyst, Himanshu Patel, predicted that the proposed structure of the deal could allow Stronach and Deripaska to buy Chrysler through a holding company, which would allow Magna's main auto parts business to keep selling to other auto companies while Magna looks to make a profit off its partial Chrysler ownership.
Big business looks to buy big car companies so it can make big lemons that we're all stuck with. There's something rotten in Denmark.
Oh, wait a minute, they aren't in the deal . . . yet.