Nissan eyes possible equity position in Chrysler

The Renault-Nissan alliance is proposing to acquire around 20 percent of Chrysler LLC and bring the Auburn Hills automaker into the French-Japanese automotive partnership, according to sources familiar with the situation.

The offer is now before private equity firm Cerberus Capital Management LP, which also is in talks with General Motors Corp. about its Chrysler holding.

Sources familiar with the discussions said Carlos Ghosn, CEO of both Renault SA and Nissan Motor Co., sent a proposal in recent days that included revisions to a draft agreement prepared by Cerberus.

The sources said Tokyo-based Nissan would acquire the stake because it has cash on hand, whereas Renault now has debts of more than $5 billion.

Nissan and Chrysler already have several joint projects in the works, with Nissan planning to produce small cars for Chrysler and Chrysler scheduled to make the next generation Titan full-size pickup for Nissan. Chrysler and Nissan managers say the teams work well together.

But another source close to the talks has told The Detroit News that Cerberus founder and CEO Stephen Feinberg favors a deal with GM, viewing it as the best solution for the embattled U.S. auto industry. More at Detroit News