Report: Cerberus halts Renault-Nissan talks, favors GM

November 1, 2008 - 1:45 pm ET


DETROIT (Reuters) -- Talks on a deal to sell Chrysler LLC to Nissan Motor
Co. and Renault SA have halted because the No. 3 U.S. automaker's owner
favors a deal with General Motors, The Detroit News reported today.



Citing sources familiar with the situation, the newspaper said no further
talks have been scheduled between private equity firm Cerberus Capital
Management LP, which sees a deal with No. 1 U.S. automaker GM as financially
more advantageous and better for the struggling U.S. auto industry.

In an earlier report, the newspaper said the Nissan-Renault alliance had
proposed buying 20 percent of Chrysler.

A spokesman for Cerberus declined to comment.

Earlier this week Nissan-Renault CEO Carlos Ghosn dismissed reports of
merger talks with Chrysler as speculation, adding that it did not make sense
to risk cash in the current economic environment to form a strategic
alliance.

GM and Chrysler have been in talks on a possible merger, but according to
sources any deal will have to wait until after the U.S. presidential
elections on Nov. 4 as the Bush administration ruled out providing
government funding for it.