Daimler reduces book value of Chrysler stake by two-thirds
Filed under: Chrysler, DaimlerChrysler, Mercedes Benz, Earnings/Financials
http://www.blogsmithmedia.com/www.au...08/04/dr-z.jpg Daimler may have divested 80.1% of its ownership in Chrysler, but the German automaker is still feeling pain from the Pentastar. The value of Daimler's portion of Chrysler has dropped from $2.18 billion to $852 million not even a year after the two parted ways. The loss of nearly $1.4 billion in value is a fair chunk of change, even for the mighty Daimler, but the news is not all bad for company shareholders. If Daimler hadn't sold Chrysler to the private equity firm Cerberus as fast as it did, the automaker's stock would likely be in much worse shape. Since the privately owned Chrysler, LLC doesn't have to report earnings, it claims that its fiscal standing is all peaches and cream. According to Chrysler, the company has had positive earnings since it was bought out by Cerberus last year. The official line that explains the discrepancy with Daimler's reporting is that U.S. accounting rules are much more favorable than those overseas. Damn accountants. [Source: Automotive News - subs. req'd] Read | Permalink | Email this | Comments More... Autoblog 2008-05-01T11:34:00+00:00 |
If Chrysler doesn't have to report earnings where did these figures come from?
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I realize that. What I meant is how do you establish the value of a privately traded company. Before, the stock market ascribed a value to it. That's like me saying my car is worth this much. A more reliable measure would be how much someone else is willing to pay me for my car.
Their statement sounds a little like, "This piece of crap company we bought ain't worth squat anymore." |
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