in the wings Blackstone is making a detailed analysis of Chrysler’s finances and operations Other possible buyers include Cerberus Capital Management Sales prospectus for bidders should be completed soon GM too held preliminary talks with Chrysler about an acquisition or some kind of alliance with the automaker

New York, March 5 (Reuters): Private equity firm Blackstone Group has emerged as a leading contender to buy the troubled US division of German automaker DaimlerChrysler AG, The Detroit News reported on its web site on Saturday, citing people familiar with the situation.

The paper said Blackstone is moving forward with a detailed analysis of Chrysler’s finances and operations with an eye toward making a formal bid, citing people familiar with the Chrysler sale process. Other possible buyers include Cerberus Capital Management, the paper said.

Blackstone and Chrysler were not immediately available for comment.

Two sources close to the sales process told Reuters last week that a detailed sales prospectus for Chrysler Group bidders should be completed soon, the first step toward a potential sale that would unwind the 1998 merger that created DaimlerChrysler.

Private equity firms are expected to be among the potential bidders for Chrysler that would consider the automaker’s sale-related documents, the sources told Reuters.

Meanwhile, General Motors has held preliminary talks with DaimlerChrysler about an outright acquisition of Chrysler or some kind of alliance with the automaker, sources have previously told Reuters.

Other automakers, including Germany’s Volkswagen AG, Italy’s Fiat SpA, affiliates of Renault SA of France and Nissan Motor of Japan and South Korea’s Hyundai Motor, have said they are not interested in buying Chrysler.

Sales grow

Chrysler Group sales outside North America rose 9 per cent in February to 15,194 units, the US arm of DaimlerChrysler said on Monday.

After its best February since 1998, Chrysler sales in the first two months of 2007 were up 10 per cent versus the same period of 2006, the carmaker said in a statement.

Boosting foreign sales by itself or with partners is a crucial objective for loss-making Chrysler, regarding which DaimlerChrysler has said it is examining strategic options including a sale or spinoff.

Chrysler Group includes the Chrysler, Dodge and Jeep brands. The Dodge Caliber compact launched last year is the top-selling Chrysler vehicle outside North America so far this year, with 4,834 units sold, it said.

“The global success of Dodge Caliber shows us that there is a significant group of customers in European and international markets who are attracted to the bold and unique characteristics of the Dodge brand,” Chrysler’s head of international sales, Thomas Hausch, said in the statement.

In February alone, the Chrysler 300C car led the product line-up with 2,629 units sold, an increase of 57 per cent. Italy is Chrysler’s largest overseas market by volume with sales up 2 per cent to 3,363 units so far in 2007.

It is followed by Germany, where 2007 sales have risen 13 per cent to 2,372 units.