China's Great Wall drops plans to acquire Jeep from Fiat Chrysler
23 August 2017
Chinese sports utility vehicle manufacturer Great Wall Motor Co today poured cold water on prospects for a deal with Fiat Chrysler Automobiles NV, saying there are no talks and it may not pursue a takeover the Italian-American car manufacturer's Jeep division.
Commenting just a day after expressing interest, Baoding-based Great Wall said in a filing to the Shanghai stock exchange there are ''big uncertainties'' on whether it will continue to study Fiat Chrysler.
On Monday, a Great Wall spokesman had confirmed its interest in purchasing Jeep, in an attempt to expand globally, though a formal offer has not been made, the Associated Press reported.
In a statement, Jeep owner Fiat Chrysler, responding to what it called ''market rumours,'' said it has not been approached by Great Wall Motors for any business matters. Nevertheless, shares of Great Wall and Fiat Chrysler had jumped on the possibility of a tie-up.
The bid attempt wasn't a surprise to many in the auto industry, since Fiat Chrysler chief executive Sergio Marchionne has made no secret of his desire for a merger or buyer to better position the world's seventh-largest car company to compete globally against the likes of Volkswagen and Toyota. He previously pursued a deal with General Motors.
In April, he said Chrysler's Jeep and Dodge brands are strong enough to stand alone like Ferrari, which the company spun off in 2015.
Italian automaker Fiat merged with Chrysler after the American auto giant stumbled during the recession and filed for bankruptcy protection in 2009. The conglomerate's brands include not just Fiat and Chrysler, but Alfa Romero, Maserati, Dodge, Ram and Jeep among others.
Adam Jonas, a Morgan Stanley analyst, said in a research note Monday that Jeep - at $24 billion - may be worth more than the rest of Fiat Chrysler combined.
In 2016, Jeep sold roughly 1.4 million vehicles, accounting for about half of Fiat Chrysler's sales.