Fiat-Chrysler deal gets EU nod

The European Commission yesterday has given its approval for the purchase of bankrupt US automaker Chrysler LLC by Italian auto giant Fiat SpA.

The European Commission, the executive branch of the 27-nation European Union (EU) said in a statement released in Brussels yesterday that the deal would not change the competitive structure of markets for the manufacture and supply of cars in Europe.

"The Commission's examination of the transaction showed that the horizontal overlaps between the activities of Chrysler and Fiat are limited," the statement said.

It further added: "As Chrysler is not present on the upstream markets concerned, the transaction would not strengthen the market position of the merged entity or the extent of its vertical integration."

A few months ago, the Italian automaker inked a deal with Chrysler that would allow it take a 20-per cent stake in the bankrupt US company. Through the transaction, Chrysler would gain access to Fiat's small and stylish vehicles and fuel-efficient technology. (See: Fiat completes acquisition of Chrysler assets)

The deal will be another feather in chief executive Sergio Marchionne's cap and will further enhance his reputation as a corporate Midas. Fiat will gain access to US market through Chrysler dealers for virtually next to nothing.