Daimler wins appeal in shareholder case over Chrysler merger

Article by Christian Andrei, on October 20, 2010

The appeals court has overturned a ruling that awarded 230 million-euro ($324 million) to former Daimler-Benz AG shareholders who claimed to not being adequately compensated in the 1998 merger with Chrysler Corp.

In an Oct. 15 e-mailed statement, the Higher Regional Court in Stuttgart, Germany, said that the shareholders' interests were taken care of when the companies negotiated the deal, which gave 1.005 shares of DaimlerChrysler AG for each share of the old Dailmer-Benz AG.

The court said that shareholders at a Daimler-Benz meeting approved the merger by an overwhelming margin.

The court said that the agreement was entered after a negotiation process that is supported by a large majority of shareholders – which the court described to the “best warranty that the executives took adequate care of the economic interests of their respective investors.” The ruling also stated that in these cases, a court has “only limited powers of review.”

This suit had originated from a conflict linked to the $36 billion takeover of Chrysler, which created DaimlerChrysler AG.

In 2007, the merger was unwound with the sale of 80.1% of the US division to Cerberus Capital Management LP. Later, Daimler dropped “Chrysler” from its name. Chrysler filed for bankruptcy last year and a government-sponsored reorganization permitted Italy's Fiat S.p.A. to take over the automaker.

The tribunal's decision overturned a lower court ruling that gave investors an additional 22.15 euros per share. During a 2008 court hearing, CEO Juergen Schrempp denied claims that Daimler-Benz downplayed its value during the 1998 merger negotiations with Chrysler to facilitate the transaction. [via autonews - sub. required]

Topics: daimler, chrysler

If you liked the article, share on:

Comments

Login or Create new account to add a comment!

Recommended

The highlight of this year’s Consumer Electronics Show may be based on some of these keywords---connectivity, integration and partnership. Just like in the previous year, you’ve probably heard and read...
by - January 16, 2017
Less than three weeks to go and the Super Bowl LI – one of the most awaited and most watched sports events in television – will commence on February 5,...
by - January 16, 2017
New Tesla vehicles will have to pay when charging at any of the carmaker’s Supercharger stations once they exceed their annual limits. This comes as Tesla Motors announced revisions in...
by - January 16, 2017
Off-road driving with an open air vehicle provides another kind of experience for many off-road enthusiasts and fans. For this sake, Ford is planning to offer a version of the...
by - January 16, 2017
For those who love driving, future autonomous cars should be like the Toyota Concept-i that is drawing in a multitude of visitors at the 2017 Consumer Electronics Show in Las...
by - January 15, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries