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Friday, August 03, 2007

Cerberus Closes Chrysler, JPMorgan Owns Pier

by Calculated Risk on 8/03/2007 03:59:00 PM

From Bloomberg: DaimlerChrysler Closes Sale of Chrysler to Cerberus

Banks led by JPMorgan Chase & Co. are taking on the remaining $10 billion.
The other Chrysler pier owners are Goldman Sachs Group, Bear Stearns, Morgan Stanley and Citigroup. The impact of these "hung" bridge loans on the growing credit crunch is significant.

Note: a bridge loan is supposed to be temporary financing while the banks syndicate the debt. When the debt can't be sold, the bridge loan becomes a "pier loan" - a bridge to nowhere - and ties up the capital of the investment banks.