Cerberus Breaks Even on Chrysler Deal

Cerberus will basically break even in its investment in Chysler with TD's acquisition of Chysler Financial.
By Maria Woehr ,

NEW YORK (

TheStreet

) -- Private equity group

Cerberus Capital Management

will essentially break even with its investment in

Chrysler Financial

after

Toronto-Dominion Bank

's acquisition is completed.

Under the deal, Cerberus will get $6.3 billion for the lender and keep over $900 million in Chrysler Financial assets. Cerberus purchased an 80% stake in Chrysler in 2007 for $7.4 billion, but lost its equity stake in the auto manufacturer as a condition of the U.S Treasury Department's bailout deal.

Cerberus, however, kept an equity stake in Chrysler Financial following the bailout that valued the auto lender at $4.75 billion. Cerberus paid the Treasury $1.9 billion to pay off Chrysler Financial's bailout debt. In addition, after the Treasury's exit Cerberus injected about $500 million into Chrysler Financial, according to a

Bloomberg article.

Keefe, Bruyette & Woods'

analyst Brian Klock

said that the deal really benefited every party involved.

--Written by Maria Woehr in New York.

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