UPDATE 1-Daimler cool on union alleging trucks spin-off

Sat Sep 6, 2008 9:37am EDT

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(adds FAS citing Zetsche on foreign state fonds)

FRANKFURT, Sept 6 (Reuters) - German car maker Daimler (DAIGn.DE) on Saturday rejected management was considering any type of spin-off or sale of the company's trucks business after an advance report in Der Spiegel magazine citing works council opposition to the plans.

"We are on track to execute our strategies. A break up is not an issue for us," a spokesman said, referring to Daimler's target to reach a 9 percent EBIT margin over the cycle at its industrial business.

He cited synergies like BlueTec technology for exhaust gas after-treatment that was developed at Daimler Trucks and later introduced at Mercedes-Benz.

The magazine report, which is due to appear in the weekly magazine on Sept. 8, cited works council chairman Erich Klemm as saying workers would heavily oppose a spin-off.

A spin-off or exchange listing of the unit had reportedly been required by Swedish financial investor Cevian, who reportedly bought a two percent stake in the company, the magazine said.

"A few percent of share ownership would stand against 100 percent of employees," Klemm said.

The Daimler spokesman would not comment on whether Cevian Capital had built a two percent stake or if it was pushing for a sale of trucks.

Daimler Chief Executive Dieter Zetsche was quoted in another story abstract issued ahead of full publication on Sept. 7 that foreign state investors were welcomed by his company so as to rein in the influence of aggressive private equity investors.

"I have no prejudices against state funds," Zetsche was quoted as saying in the Frankfurter Allgemeine Sonntagszeitung, be it Arabs, Russians or Chinese, he said. (Reporting by Christiaan Hetzner and Vera Eckert; editing by Chris Pizzey)

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