June 17 (Bloomberg) -- Daimler AG, the world's second-largest maker of luxury cars, plans to buy back as much as 10 percent of its shares for 6 billion euros ($9.3 billion), bowing to investor pressure after the stock fell by almost a third this year.

Daimler rose the most in more than four months in Frankfurt trading after the Stuttgart, Germany-based company said it will purchase as many as 96.4 million shares by April 2009. Daimler already bought back 6.2 billion euros of stock between August and March in its first purchase of shares.

Chief Executive Officer Dieter Zetsche is pursuing the buyback to appease shareholders after profit fell 32 percent in the first quarter to 1.33 billion euros, dragged down by Daimler's remaining 19.9 percent stake in Chrysler and lower truck sales in the U.S. The German company's connection with Chrysler has continued to hurt earnings after the sale of most of the Auburn Hills, Michigan-based automaker.

``That is finally what the market was looking for,'' Georg Stuerzer, a Munich-based analyst with UniCredit, said in an interview. ``The move is a signal that the ongoing business is running well.''

Daimler gained as much as 2.26 euros, or 5.2 percent, to 45.94 euros in Frankfurt, the sharpest advance since Feb. 12. The stock was up 4.3 percent at 2:26 p.m., valuing the company at 44 billion euros.

Forecast for Improvement

Daimler said June 4 that earnings this year will rise as car and truck sales increase. Earnings before interest and taxes will be ``well above the prior-year level,'' excluding the effects of selling Chrysler last year, Daimler said.

``It's a clear signal that management is looking optimistically into the future,'' Arndt Ellinghorst, head of automotive research at Credit Suisse in London, said today. ``This is further confirmation of their strategy to give cash back to investors.'' Ellinghorst has an ``outperform'' recommendation on the stock.

Zetsche sold Chrysler to Cerberus Capital Management LP in August after the takeover by his predecessor, Juergen Schrempp, led to a $12.6 billion reduction in Daimler's market value. In April, the German automaker lowered the value of its Chrysler stake by 40 percent. The purchase of the smallest of Detroit's three carmakers failed as excess capacity, high costs and disappointing models crimped earnings.

Mercedes Makes Amends

The Chrysler burden, and a 13 percent drop in revenue at Daimler's truck business, overwhelmed improved results at Mercedes-Benz Cars, which boosted profit and sales in the first quarter. Daimler lost top position in luxury-vehicle sales to German rival Bayerische Motoren Werke AG during the Chrysler debacle. It remains the largest truckmaker in the world.

Mercedes-Benz is counting on an updated A-Class car and B- Class crossover model to help it achieve record sales this year. The car unit is seeking to wrest back market share from Munich- based BMW while fending off Volkswagen AG's Audi unit and Toyota Motor Corp.'s Lexus division.

BMW received approval in May from shareholders to possibly repurchase 10 percent of the shares. The carmaker has no plans in the short term to buy back shares, Mathias Schmidt, a spokesman, said in a telephone interview. BMW completed its last stock purchase in February 2006, paying 758.9 million euros for 3 percent of the shares.

Chrysler's Drag

Daimler's stake in Chrysler wiped 491 million euros from first-quarter earnings as the slowing economy hurt sales. The sale of most of the company provided Daimler with an influx of cash. At the end of March, the company had 11.7 billion euros in cash in its car and truck businesses.

Daimler will cancel the repurchased shares or use some for stock-option plans. The purchases will be carried out by UniCredit, which will start buying shares in the next few days, Stuttgart-based spokesman Thomas Froehlich said.

Daimler is laying off 1,500 factory workers and eliminating one shift at the Freightliner trucks unit in the U.S. to accommodate a continued sales slump. The unit employs 20,000 people in the North American trucks division.

Revenue at the truck business fell 13 percent to 6.33 billion euros in the first quarter as U.S. deliveries plummeted 47 percent.

To contact the reporter on this story: Chris Reiter in Berlin at creiter2@bloomberg.net

Last Updated: June 17, 2008 08:29 EDT