Chrysler May Sell Control of its Finance Unit : Autos: The sale could bolster the car company’s bottom line and increase the financing subsidiary’s credit rating.

Chrysler Corp. may sell controlling interest in its finance subsidiary within a month, a top Chrysler official said.

The sale could bolster Chrysler’s bottom line and enhance the auto maker’s remaining investment in Chrysler Financial Corp. by freeing the financing arm from the stigma of its parent company’s troubles, analysts said.

“Within 30 days, we will have consummated, one way or another, discussions with the eight or nine companies we had identified as potential major players in this transaction,” Jerome B. York, Chrysler Corp. executive vice president for finance, said Sunday.

The candidates may include a large insurance company, an independent finance company and Japanese auto maker Mitsubishi Motors Corp., he said in a newspaper interview. York did not identify the other candidates.

“Mitsubishi is growing rapidly, and as that growth proceeds, their dealers and their customers are going to have a demand for more and more financing,” York said. “They could become a partner if they bought X percent of the shares of Chrysler Financial.”

Chrysler owns 11% of Mitsubishi stock and jointly produces a car with the Japanese auto maker in Illinois.

“If I were the head of a major Japanese auto company, I might look at the situation and say, ‘Well, gee, maybe I better talk to my associates, other Japanese companies, and maybe we could jointly use this as a financing mechanism for our sales in the U.S.,’ ” York said.

A sale of more than 50% interest in the subsidiary would give Chrysler hundreds of millions of dollars in a time of declining sales and profits. Half the stock would cost more than $1.3 billion, York said.

Last month, rating agencies lowered the credit rating of Chrysler and its finance subsidiary to speculative, or junk bond, grade. Relinquishing control of Chrysler Financial could improve the subsidiary’s credit rating.

“It would be beneficial because Chrysler Financial would have better access to (money) markets,” said Carol Verschell, auto analyst at Moody’s Investors Service Inc. “And, of course, Chrysler would be paid money it could use to pay down debt or put into product programs.”

Scott Sprinzen, a vice president of Standard & Poors Ratings Group, said Chrysler Financial could earn another $100 million a year if it had a higher credit rating.

“The less ownership Chrysler has in CFC, the easier it would become to view CFC as less dependent on Chrysler’s credit quality,” he said.

Chrysler Financial Chairman John Tierney has acknowledged that his company has suffered from “guilt by association.”

Chrysler Financial earned a record $313 million in 1990, up 10% from 1989. Chrysler eked out a $68-million profit versus $359 million in 1989.