On August 3, 2007, the key players – Chrysler and Cerberus executives –struck a $7.4bn deal. The deal was expected to close during the summer.

Importantly, Chrysler still retains its automotive identity. Chrysler Holding LLC is the new name for the US-based Chrysler group.

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Cerberus closed quickly on the Chrysler acquisition and arranged an 80.1% stake in the automaker from former parent DaimlerAG, based in Stuttgart, Germany.

Then, in a surprise move on August 7, Bob Nardelli was named as the new CEO at Chrysler Holding at Chrysler headquarters in Auburn Hills, Michigan. He is a former CEO at Home Depot, Inc, the US’s leading home improvement retailer.

The new Chrysler chairman and CEO is now at the helm of the independent Chrysler firm. He replaces Tom LaSorda, who will stay on as vice-chairman and president, reporting to Mr Nardelli. It is possible he will serve on new Chrysler’s 11-member board of directors.

“I am very excited to be part of a team focused on re-establishing Chrysler as a standalone industry leader, with a renewed focus on meeting the needs of customers,” Mr LaSorda said in a statement following the announcement.

During the flurry of announcements, Eric Ridenour, Chrysler’s then CEO and Mr LaSorda’s number two, a 23-year veteran of Chrysler, said he would leave the new company to pursue other opportunities. The COO position will not be filled in the near future, Chrysler said in a release.

The speedy agreements between the investors and Chrysler signaled just how important the stakes were on both sides. Ultimately, the New York-based equity firm was hailed as a rescuer for Chrysler by New York’s Wall Street.

“Chrysler has many deeply talented and dedicated people, and I am confident that together we can continue the momentum of Chrysler’s recovery and return this great American icon to a path for global growth and competitiveness,” Mr Nardelli said in a statement.

Mr Nardelli was quick to endorse Chrysler’s recovery and transformation restructuring plan, which Mr LaSorda launched in February this year as CEO.

Chrysler has had its marketplace struggles in the past two years. Last year, the Chrysler group lost $1.5bn in North American revenues. Group US sales were down 2% through July this year. The automaker has been forced to rely on industry-high incentives to move new products, including 2008 minivans and even new pick-up trucks next year.

However, Chrysler group sales outside North America were the highest in a decade last year, 15% more than in 2005. Chrysler group produces three brands in North America – Chrysler, Jeep and Dodge cars and trucks.

Lillie Guyer