The story of Chrysler being on the auction block has been around for a few weeks, and rumors of a takeover lead by Canadian-based auto parts maker Magna seem to be taking shape; Magna may be taking on some private equity partners to make the deal possible-
U.S. media reports have pointed to private equity firms Cerberus Capital Management and a group consisting of Blackstone Group LP and Centerbridge Capital Partners LP as the leading bidders for Chrysler.
The name Cerberus rung a bell from my school days; it's the three-headed dog that guards the gate of Hades, ensuring "that all spirits could enter, but none could return." Or, to borrow from the last line from Hotel California, the dog is "programmed to receive; you can check out any time you like, but you can never leave."
Not exactly the kind of vision that a Chrysler shop rat wants to see. Canadian Auto Workers boss Buzz Hargrove didn't like that vision much-"That's a big concern to us, because their history is to cut a lot of jobs, close a lot of plants, get lean and mean in a hurry to sell and make a lot of money for executives and throw a lot of people out of work."
That Magna-Cerberus team would have some interesting connections on both sides of the border. Magna's chairman Frank Stronach daughter Belinda is a Liberal MP (and former Conservative Party leadership candidate before crossing the aisle), while Cerberus has quite a few Republican heavy hitters. Dan Quayle has been on the Cerberus payroll and former Treasury Secretary John Snow is the new chairman.
It would likely mean some rather ruthless job-cutting on the part of the new team; part of that hardball could spill over into politics. Hargrove is a major player in the NDP, and having a Liberal stalwart like Stronach (he's been a Liberal for a longer time than his daughter, having stood for Parliament as a Liberal candidate in 1988) be part of a harsh job-cutting regime at Magna-Chrysler might have some interesting political ramifications. The CAW is not afraid to strike, and tends to play hardball much more easily than their UAW counterparts on the other side of the Detroit River.
This will be one interesting story to watch.