| |||||||||||
| |||||||||||
Nardelli's next flip: Chrysler
Nardelli, who was named Chrysler CEO by new owner Cerberus Capital Management LP on Monday, knows a thing or two about extracting value where few else see it. The executive famously exited Home Depot with a $200 million severance package just as the U.S. housing market began to crater. His new job comes with considerable challenges. Chrysler, which lost more than $680 million last year, needs to refresh its product lineup and extract cost cuts from unions who had sworn allegiance to Detroit-veteran Tommy LaSorda, who Nardelli is replacing, but who have in the past railed against the sort of executive compensation Nardelli is famous for. That Cerberus would seek out a replacement for LaSorda, who was at the helm as Chrysler’s financial problems stacked up, was not a surprise, and many in the industry expected the private equity giant to seek out an outsider to inject new ideas into the stagnant U.S. auto business. Cerberus has won praise for its courting of the United Auto Workers, whose leaders initially feared a private equity takeover. The risk now is that the choice of Nardelli could rekindle some fears that Cerberus is interested only in cutting costs and quickly flipping a trimmed-down Chrysler to Wall Street. Canadian Auto Workers head Buzz Hargrove told reporters Monday that he was “surprised and concerned” by the hiring, though a UAW source added that the group still has high hopes of working with Chrysler’s new owners. The choice of Nardelli comes after weeks of speculation that former Chrysler executive and Cerberus adviser Wolfgang Bernhard would be named chairman of the company. A source said that Bernhard declined the job for personal reasons. Nardelli’s appointment leaves auto outsiders in charge at two of the Big Three. Last September, Boeing Co. executive Alan Mulally took control of Ford Motor Co. to lead that company’s restructuring. —Lou Whiteman
Go
to Chrysler's release Tags: Chrysler, Cerberus Capital, acquisition, deals, m&a, mergers, private equity CategoriesPrivate capital video
Categories
Blog roll
Archives
| |||||||||||
Bob
Nardelli in his last job benefited greatly from a real estate boom fueled by
customers looking to get rich off of fixer-uppers. Now, the former Home Depot
Inc. CEO will get a chance to lead a flip of his own as head of private
equity-owned turnaround candidate Chrysler Group.
|
|
|
|
|
