Two insiders said that Cerberus Capital Management LP is looking for buyers for Chrysler Financial, an auto lender that the private-equity firm got as part of its takeover of Chrysler LLC in 2007. The sources said that in the past several days, Cerberus has started soliciting interest in the business from large banks.
They reported that Chrysler Financial, which was the former lending arm of Chrysler, has a book value, or assets minus liabilities, of about $6 billion or $7 billion.
Selling Chrysler Financial would mark a further step in unwinding Cerberus founder Stephen Feinberg's stake on the US auto industry.
Feinberg’s move to take over General Motors Corp.'s auto lender in 2006, and Chrysler’s auto lender the following year came before a drop in US auto sales that pushed these automakers into bankruptcy.
Feinberg later gave up control of both GMAC and Chrysler but had held on to Chrysler Financial. Last year, the lender repaid its $1.5 billion in US Treasury Department bailout funds.
And in July, it aimed to return to large-scale lending. Cerberus and Chrysler Financial have yet to comment on this report. [via autonews - sub. required]