Cerberus claims Daimler misled them on deal

The firm purchased the majority stake in Chrysler Holding from DaimlerChrysler in 2007 and was to purchase the remaining 19.9 per cent.

The Cerberus statement reads, 'Daimler intentionally and materially breached its obligations under the relevant contracts relating to the Chrysler transaction. These serious breaches include, but are not limited to, misrepresentations relating to extraordinary changes in underwriting practices with regard to vehicle acquisition financing and leasing, as well as non-ordinary course lending and leasing practices.

'This conduct, among other reasons, led the parties to engage in lengthy negotiations toward a mutually agreeable settlement. Daimler has, unfortunately, refused to recognise the gravity of the claims relating to its deliberate conduct that resulted in the impairment of Chrysler's business and added to and multiplied the adverse effects of the current automotive and macro-economic environment. We are disappointed that Daimler has refused to negotiate in good faith in the face of the plain facts of which they are well aware. Accordingly, we are considering our strategic options and will have further comment after assessing the effects of Daimler's recent actions.'

Cerberus is now asking Daimler for over $7bn in compensation, Reuters reported.

Daimler-Benz bought Chrysler for $36bn in 1998.

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