A U.S. court upholds a lower-court ruling denying investor Kirk Kerkorian and his Tracinda Corp. investment firm damages as a result of the 1998 merger of Germany’s Daimler-Benz AG and U.S.-based Chrysler Corp.
DaimlerChrysler AG released a one-sentence statement noting the decision, saying it was “pleased…the Third Circuit (Court of Appeals) has unanimously affirmed the trial court’s judgment dismissing Tracinda’s complaint.”
Kerkorian sought more than $1 billion in damages, alleging he and other Chrysler shareholders at the time of the merger – Kerkorian once controlled 14% of Chrysler stock – were duped into accepting the deal with Daimler-Benz, which had been billed as a “merger of equals” by then Daimler-Benz Chairman Juergen Schrempp and Chrysler CEO Robert Eaton.
Schrempp, who remained DaimlerChrysler CEO, later was quoted by the Financial Times as saying the merger was never anything more than a strict takeover of Chrysler by Daimler-Benz, but was characterized as a merger in order to lower the transaction price and avoid paying shareholders a premium on their stock.
Those comments, published in October 2000, triggered the suit by Tracinda.
