DaimlerChrysler chief executive Juergen Schrempp said on Thursday he had "no regrets" about the 1998 link-up of Germany's Daimler-Benz and Chrysler and insisted it was a "merger of equals," according to a Reuters report.

Schrempp spoke after testifying for the third straight day in a Wilmington, Delaware, court where billionaire investor Kirk Kerkorian, who accuses Schrempp of fraud, is suing the automaker for more than $US1 billion, the report added.

Kerkorian reportedly claims that Schrempp and other Daimler executives pitched the deal as a merger rather than a takeover to lower the transaction price and avoid paying Chrysler shareholders a "control premium."

Reuters said that Schrempp denied that, during a total of about 13 hours on the witness stand, and told reporters he was glad to tell under oath his side of the story behind one of the biggest deals in automotive history.

"I still believe that the merger of equals was fantastic. We are making tremendous progress," Schrempp reportedly said outside the court, adding: "We are seeing the results coming and I have no doubt that over the years we will make it to the top. I have no regrets whatsoever. We are one company and I think we will be successful."

Reuters said that Kerkorian's case rests largely on an October 2000 interview with the Financial Times in which Schrempp suggested the tie-up between Daimler and Chrysler was only billed a merger of equals for "psychological reasons" and that he always intended to make Chrysler a "division" of the combined company.

Schrempp defended his remarks to the newspaper, saying he had sought to stress that DaimlerChrysler, the world's fifth-largest automaker, was "an international, integrated automotive company" with two distinct operating divisions but he also acknowledged that he avoided referring to Chrysler as a "division" to soft-pedal the deal during merger talks, which could give weight to Kerkorian's claims that details of the Chrysler acquisition were withheld to appease US shareholders, Reuters added.

A lawyer for Kerkorian's Tracinda Corp. investment firm asked Schrempp to confirm that before its deal with Chrysler, Daimler had considered merging with General Motors, Ford or Toyota and Schrempp testified those ideas were rejected because Daimler-Benz feared becoming a junior partner in the transaction, Reuters said. Schrempp reportedly said Chrysler was seen as an ideal partner, and that its looming financial problems were unknown to Daimler at the time of the deal.

But even with those problems and subsequent fallout from the $36 billion merger, Schrempp said Daimler's decision to join forces with the third-largest US carmaker was the right choice in a consolidating global industry, Reuters said.

Without the merger, Schrempp reportedly said, "We would run the risk of being taken over because we on our own have not sufficient scale."

Reuters noted that US District Judge Joseph Farnan is trying the case without a jury and the verdict, as to whether Chrysler was taken over, may be months away.

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