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GM's Wagoner sees possible GMAC Financial-Chrysler Financial alliance

From Automotive News| May 18,2007

General Motors CEO Rick Wagoner says there are opportunities for GMAC Financial Services and Chrysler Financial Services to work together.

Private equity firm Cerberus Capital Management LP owns a 51 percent stake in GMAC, and it has agreed to pay $7.45 billion for the Chrysler group,including Chrysler Financial.

Wagoner says Cerberus has been a good partner so far with GMAC, adding that it will be a good partner for Chrysler Corp., too. He sees opportunities for GMAC to work with Chrysler Financial in the future.

"There are potential synergies and a lot of different ways to think about it," Wagoner said at a luncheon today here for Inforum, a Michigan professional women's group. "As of yet, nothing has been specifically presented to us, and we haven't developed any ideas, but I'm sure that will be happening over time."

Wagoner stopped short of saying a merger between the two finance companies would happen.

"It's too early to speculate on what is the right way to cooperate and get value," he said. "There are a lot of issues to think through, but it's clear there are value opportunities. We haven't made any calls, and anything we do there would have to be agreed by everybody."

As for GM working with Chrysler on joint product projects or other issues, Wagoner left that door open.

"History tells us you don't rule anything out, but we're not working on anything like that right now," he told reporters today.

Wagoner foresees the auto industry changing shape in the next decade with more consolidation. He would not speculate about where that consolidation would happen or when but said he did not see a "mad rush to privatize" the auto sector.

As for GM being bought by a private equity firm, Wagoner said: "You can't rule anything out because the amounts of money tossed around are so big. We're not thinking along those lines at this point. I can't tell you what's in everybody else's mind."

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