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Thursday, Jan. 21, 1999

DaimlerChrysler AG merges finance arms

Unit has $81 billion loan portfolio, desire for global expansion

By DAVID GOODMAN
Associated Press

   DETROIT - DaimlerChrysler AG is merging its financial services into a worldwide unit that will lend money for airplanes, ships and real estate, as well as cars and trucks.
   DaimlerChrysler Services AG, which the German-American automaker calls its "debis" division, has a loan portfolio of $81 billion and ambitions of rapid growth around the globe.
   "We have begun a major undertaking. We have established the fourth-largest non-banking financial company in the world," DaimlerChrysler management board member Klaus Mangold said Wednesday in a teleconference.
   Mangold becomes chairman of debis. He called the move "another example of the record pace of the DaimlerChrysler integration process."
   DaimlerChrysler stock rose $1.37 to $106.75 on the New York Stock Exchange.
   Debis will be based in Berlin but will continue to maintain its offices in the Detroit suburb of Southfield, Mich., and in Norwalk, Conn. Mangold said no layoffs are planned, and he expects the work force to expand.
   The new division should meet or exceed the 10 percent to 12 percent annual growth rate of the financial arms of the former Daimler-Benz AG and Chrysler Corp., he said.
   The consolidation had been planned since the creation of DaimlerChrysler AG in November.
   While Chrysler Financial was involved only in automotive financing, debis already was diversified with business in such areas as train systems, insurance, telecommunications and real estate management. Debis now will enter those areas in North America and other markets, Mangold said.
   In 1998, debis and Chrysler Financial reported combined revenues of $14 billion and through the first nine months of last year, operating profits of $842 million.
   DaimlerChrysler will not release debis' full-year earnings until its annual press conference March 31, a spokesman said.

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