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Fiat reaches deal to buy remaining 41.5% of Chrysler shares
Guardian (UK) ^ | Wednesday 1 January 2014 18.26 EST

Posted on 01/01/2014 6:50:57 PM PST by DeaconBenjamin

Italian car manufacturer Fiat announced on Wednesday that it has reached an agreement to acquire the remaining shares of Chrysler for $3.65bn to a union-controlled trust fund.

Fiat already owns 58.5% of Chrysler's shares, with the remaining 41.5% held by a United Auto Workers trust fund that pays health care bills for retirees.

Under the deal, Fiat will make an initial payment of $1.9bn to the fund, plus an additional $1.75bn upon closing the deal.

Chrysler will also make additional payments totalling $700m to the fund as part of an agreement with the UAW. The deal is expected to close on or before 20 January, according to a statement from Chrysler.

Sergio Marchionne has long sought to acquire the union's shares in order to combine Fiat and Chrysler.

"The unified ownership structure will now allow us to fully execute our vision of creating a global automaker that is truly unique in terms of mix of experience, perspective and knowhow, a solid and open organisation," Marchionne said in a statement.

The deal eliminates the need for an initial public offering of the union fund's stake, which analysts had previously valued at $5.6bn.

Marchionne cannot spend Chrysler's cash on Fiat's operations unless the companies merge. In recent months he made it clear that he preferred to settle the dispute without an IPO, but filed the paperwork for the offering in September at the trust's request.

Chrysler's profits helped prop up Fiat's balance sheet as the Italian firm struggles in the depressed European market.

The Michigan-based car company earned $464 million in the third quarter on US sales of the Ram pickup and Jeep Grand Cherokee, its ninth straight profitable quarter. The results boosted Fiat, which earned $260m in the quarter. Without Chrysler's contribution, Fiat would have lost $340m.

(Excerpt) Read more at theguardian.com ...


TOPICS: Business/Economy; Foreign Affairs; US: Michigan
KEYWORDS: automakers; chrysler; fiat; italy; michigan
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To: ltc8k6

For a look at how bad Fiat mismanages, check out their failed attempts to re-introduce the Alfa-Romeo to the American market. Even though it would be in the much more profitable entry-level luxury class, they just can’t get it done.

The Alfa-Romeo 4C, for example, was supposed to be a kind of upscale Mazda Miata. By the time it actually arrives, it’s more like a pricey Jaguar F-type, and Fiat has no plans to sell more than hundreds of them through Maserati dealers instead of as using them as a halo car at Chrysler or even Fiat.


41 posted on 01/01/2014 7:53:07 PM PST by jjotto ("Ya could look it up!")
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To: tcrlaf
Fiat’s FIRST move should now be to introduce the Strada small pickup to Chrysler’s US Market, under the Dodge nameplate.

Rebadged as a Rampage, it might work. Fiat also offers a four/five passenger Strada mini-pickup.


42 posted on 01/01/2014 7:54:56 PM PST by A Formerly Proud Canadian (I once was blind, but now I see...)
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To: Huskrrrr

“My neighbor traded in her Smart car for a little Fiat.”

Jumped from the fire into the frying pan, so she’s probably a tiny bit better off in this case. That is unless she takes either one of these cars onto a freeway, then she’ll be sitting duck for the rushing streams of semis and SUVs.


43 posted on 01/01/2014 8:06:47 PM PST by catnipman (Cat Nipman: Vote Republican in 2012 and only be called racist one more time!)
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To: Soul of the South

Not long. Unions are leeches and in a just world their leaders would be lined up on a wall and shot.


44 posted on 01/01/2014 8:07:07 PM PST by dinodino
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To: GeronL
it’s a foreign company, we are down to 1.5 US companies.

Our American economy consists of trading real assets for cheap consumer goods. Trade deficits matter and current accounts will be balanced.

45 posted on 01/01/2014 8:08:15 PM PST by Last Dakotan
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To: RoosterRedux

All of the Fiat dealers in my area are Chrysler dealers selling and servicing Fiats and the other Chrysler brands. The Fiats are sold and serviced by the same people.


46 posted on 01/01/2014 8:11:49 PM PST by ltc8k6
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To: DeaconBenjamin

I have a 2013 Fiat 500. Terrific car. 5 speed manual, very fun to drive. Fully loaded, I paid $14975 including all taxes. If I drive the speed limit, I get as much as 55 mpg, and 42 mpg is my usual mileage.


47 posted on 01/01/2014 8:15:05 PM PST by quicksilver123
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To: DeaconBenjamin
I am going to disagree with most here, I think the Fiat buyout is the best that we could have hoped for. Mercedes Benz bought Chrysler back in the 90s and IMO raped the company for it's cash and intellectual properties. When Mercedes decided to dump Chrysler, there were no takers except the privately held holding company that owned Century 21 and a few others. Interestingly no automobile company wanted Chrysler, so all Chrysler did for the next few years was tread water. Then came the Bush/Obama Bailouts. Free money and a chance to unload Chrysler. We all know the rest. Now Fiat, an automobile company will own Chrysler and maybe just maybe the old name plate will survive, though I expect Dodge to go the way of Plymouth. In my opinion, the real villain in this story is Mercedes Benz with the UAW tagging along like the little toady in A Christmas Story.
48 posted on 01/01/2014 8:17:19 PM PST by Tupelo (I am feeling more like Philip Nolan every day)
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To: Tupelo

“In my opinion, the real villain in this story is Mercedes Benz”

I have some inside knowledge about that one.

Mercedes really only wanted the Jeep nameplate for Asia and Africa, and went so far as to produce Grand Cherokees in Austria, while the Malaysia deal for China imports went south.
(FIAT Just reached a deal to build Wranglers and Grand Cherokees in China with Guangzhou Automobile Group for 2014/15.)

The culture clashes between the Brass-n-Glass Palace in Auburn Hills, the Unions, and Stuttgart were HUGE, and they could never reconcile the American Manufacturing Method of “Good Enough”, with the German anal-retentive drive for quality over quantity.


49 posted on 01/01/2014 8:30:27 PM PST by tcrlaf (Well, it is what the Sheeple voted for....)
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To: central_va

Specs look good to me except the 0-60 time of 13 seconds.


50 posted on 01/01/2014 8:42:03 PM PST by willk
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To: central_va

Don’t worry. The diesel will never survive the EPA.


51 posted on 01/01/2014 8:57:14 PM PST by cableguymn (It's time for a second political party.)
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To: Minutemen

I had one in 1991.. I called it a poor mans 911...

Then the engine FELL OUT!! rolling down the highway, it fell right out on the highway. Rusted frame rails.


52 posted on 01/01/2014 8:58:56 PM PST by cableguymn (It's time for a second political party.)
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To: SeaHawkFan

US spec’d ones will have much lower towing and cargo ratings. Take a look at some of the other cars made.

Have you EVER seen a Hyundai sedan towing a small camper trailer in the USA?

Nope.

But you see them all over the price in the UK. Rumor has it we have more lawyers here.


53 posted on 01/01/2014 9:01:25 PM PST by cableguymn (It's time for a second political party.)
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To: DeaconBenjamin

FIAT. Fix It Again Tony.


54 posted on 01/01/2014 9:03:33 PM PST by dancusa (Molon Labe)
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To: DeaconBenjamin

I like the Fiat influence. I just got a new Jeep Cherokee. With the technology package it can almost drive itself. I set the adaptive cruise control and lane control and while on a slight curve on the freeway took my hands off the wheel. Followed the lane nicely but an alarm went off (doesn’t like your hands off the wheel for more than a few seconds because it thinks you have fallen asleep at the wheel). Very plush inside with a really smooth and quiet ride. The Trailhawk version is trail rated.


55 posted on 01/01/2014 9:08:43 PM PST by willk
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To: DeaconBenjamin

The Great Italian Auto Bailout — Courtesy of U.S. Taxpayers

http://www.openmarket.org/2014/01/01/the-great-italian-auto-bailout-courtesy-of-u-s-taxpayers/


56 posted on 01/01/2014 9:31:02 PM PST by ltc8k6
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To: Huskrrrr
I guess she likes those little clown cars.

LOL!

57 posted on 01/01/2014 9:31:19 PM PST by FlingWingFlyer (The Truth Is Out There. Just don't let anyone know that you're looking for it.)
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To: RoosterRedux

My 90 Wrangler was the best car I ever owned & that includes 2 Toyota Supras & 2 SR54WDs. I replaced a water pump & the tires in 16 years. lol & a bumper flare when I kissed the garage door frame.

If you take care of it & get a good year, they’ll just about last forever.


58 posted on 01/01/2014 9:38:20 PM PST by KGeorge (Till we're together again, Gypsy girl. May 28, 1998- June 3, 2013)
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To: central_va

not even 100 horsepower!?


59 posted on 01/01/2014 10:24:53 PM PST by Secret Agent Man (Gone Galt; Not averse to Going Bronson.)
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To: RoosterRedux

There are at least five vehicles made by Fiat and Alfa Romeo that would enjoy immediate success in the US. The Alfa 4C and Spider are great cars and would be heavily on demand if they released them in the US.

I think the general problem with Chrysler....is lack of imagination (with the engineers), and union pressures (building them). If you walked in and basically bought the name of Chrysler, corrected the top layer of the company....so that it wasn’t so screwed up, and started some industry in Georgia and Alabama...you could eventually dump the Chrysler name in ten years, and go Fiat only....discovering that the name is now seen mostly positive.

I can remember 1980....and a co-worker I knew...had a 1970’s Fiat which was broke every three or four weeks, with maintenance and parts draining him constantly. He cursed the car from that angle, but it was a five-star driving experience when it was running right.


60 posted on 01/01/2014 10:53:45 PM PST by pepsionice
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