Mitsubishi Motors sold to Goldman Sachs

[gaijin]

Goldman grabs all of Daimler's MMC stake

By KAHO SHIMIZU
Staff writer

DaimlerChrysler AG sold its entire stake in Mitsubishi Motors Corp. to Goldman Sachs International, making the securities firm the top shareholder in the automaker with a 13.45 percent stake, MMC said Friday.

The German-American auto giant will post a 500 million euro gain in the current fiscal year with the sale of its 12.42 percent stake to Goldman, DaimlerChrysler said.

DaimlerChrysler, which was once the top shareholder in MMC, with a 37 percent stake, decided to halt its financial support to the struggling automaker in April 2004.

This forced MMC to seek a capital injection from other investors and Mitsubishi group firms. This caused DaimlerChrysler's stake in MMC to shrink.

"The current joint projects between DaimlerChrysler and MMC will not be affected by the (asset) disposal, and will continue as previously agreed," including joint development and production of engines, DaimlerChrysler said in a statement.

Before the completion of the sale of DaimlerChrysler's stake in MMC to Goldman, Mitsubishi Heavy Industries Ltd. was the top shareholder, with a 13.9 percent stake, according to MMC.

MMC, which has been embroiled in vehicle defect coverups, is struggling to turn its business around.

Although the carmaker's losses narrowed significantly in the first half of fiscal 2005, it still had a net loss of 63.8 billion yen and an operating loss of 19.8 billion yen in the six months from April to September.

MMC officials said there will be no impact on the automaker from the share transaction.

DaimlerChrysler had previously said it has no intention of selling its stake in MMC, but analysts were skeptical, saying there is no reason for the German carmaker to keep holding the shares.

"DaimlerChrysler must have been waiting for the best time to sell its stake in MMC to minimize its loss from the deal," said Yasuhiro Matsumoto, a senior credit analyst at BNP Paribas Securities (Japan) Ltd.

The Japan Times: Nov. 12, 2005