Fiat plans to raise stake in Chrsyler during IPO
04 Jan 2011
Italian carmaker, Fiat SpA, yesterday said that it has no plans to merge with Chrysler, but could possibly raise its stake in the US carmaker from the present 20 per cent to 50 percent when Chrysler returns to the stock market this year.
Sergio Marchionne, chief executive of Turin-based Fiat, said that although the company has no plans to merge, it would be "advantageous" for Fiat to take a controlling stake in Chrysler.
"I don't know whether it is likely, but it is possible that we will go over 50 per cent if Chrysler decides to go to the market in 2011," said Marchionne, also the CEO of Chrysler, during the celebrations of the first trading day of Fiat's industrial division at Milan's Stock Exchange.
Fiat, Italy's largest carmaker, had last year acquired a 20-per cent stake in bankrupt Chrysler in a move to gain access to the US market through Chrysler's dealers for virtually next to nothing. (See: Fiat completes acquisition of Chrysler)
But through the deal, Chrysler got the small-car and clean-engine technology from Fiat and the Italian automaker's management expertise.
Fiat is in the midst of a turnaround with Marchionne in the reins. Marchionne, a financial expert, had taken the helm of Fiat in 2004, when the carmaker was on the verge of bankruptcy.
