Quadrangle’s Rattner to become advisor on auto industry

Steven Rattner has stepped down from the private equity firm he co-founded, the Quadrangle Group, to become an adviser to the U.S. Treasury Department on the restructuring of the troubled auto industry.

Quadrangle Group said in a statement that Michael Humber and Joshua Steiner would become co-presidents of the private equity firm, replacing Rattner effective immediately.

Rattner, a former journalist with The New York Times whose banking career has included prominent media deals, has also been an active fund-raiser for the Democratic party.

Before founding Quadrangle Group in 2000, Rattner had been a managing director at Lazard Freres & Co., where he was a member of the investment bank’s media team.

Rattner will become a counselor to U.S. Treasury Secretary Timothy Geithner on a range of economic and financial issues and will lead the team advising Geithner and National Economic Council Director Larry Summers on the auto industry.

The task force is charged with overseeing the government bailout of General Motors Corp. and Chrysler and deciding whether to provide more aid to the cash-strapped automakers. GM and Chrysler, which were granted $17.4 billion in federal loans in December, requested nearly $22 billion in additional U.S. aid late last month when they submitted new restructuring plans.

Rattner was considered a leading contender to advise President Barack Obama on the restructuring of the auto sector when the administration had been expected to name a single official with broad powers, a position that became known as the “car czar.”

Instead, Obama surprised industry analysts and executives by opting to appoint a team of officials, headed by Geithner and Summers, to oversee the bailout of GM and Chrysler and requests for aid from parts suppliers.

Ron Bloom, a restructuring expert with investment banking experience who has advised labor unions, has also been named one of the advisers to the Obama administration’s auto team. —Kevin Krolicki, Reuters