GM-Chrysler talk faces big test when markets open

The opening of trading this morning on the New York Stock Exchange will give investors a chance to put their money on what they think of the possibility of General Motors Corp. merging with rival Chrysler LLC.

Revelations that GM officials were talking with Chrysler's majority owner Cerberus Capital Management — and reports that the odds of a deal happening are as high as 50% — came to light late Friday. So Monday's trading will be the first opportunity for investors — coming off of one of their worst weeks ever — to pass judgment.

Several industry analysts were skeptical that Wall Street would greet the news positively. "I don't know if the market is going to receive this well," said Erich Merkle, an analyst from Crowe Horwath LLP. "You've got GM, who most people think is on the verge of bankruptcy in the not-so-distant future, given their cash position. And then taking on Chrysler at this point — I just don't know if the market is going to look at that favorably, unless there is something more under the surface."

Aaron Bragman, an industry analyst with Global Insight, echoed those thoughts. "Basically, everybody I've talked to from the analyst community is like, 'Really? What?' " Bragman said. "For GM, I don't see how this is a positive." Detroit Free Press