Regions

Rumors as to Fiat-VEBA deal flew because of top executive absences

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September 9
1:06 PM 2013

The speculation as to the full acquisition by Fiat of all Chrysler Group shares became fever pitch when the Italian auto manufacturersaid that many of its top executives would no longer attend the Frankfurt auto show.

According to a Fiat official communique, CEO Sergio Marchionne and Chairman John Elkann would not be attending the highly regarded industry gathering, saying Marchionne had last minute 'business commitments'. This comes a surprise as the Chrysler and Fiat CEO has been known to draw an audience during these events, including the Frankfurt Auto Show.

Because of the speculation, Fiat shares jumped 5.1% in afternoon trading in the Italian bourse as many traders awaited the finalization of the deal between Fiat and VEBA. VEBA is the retiree healthcare trust of the United Auto Workers union. It owns 41.5% of Chrysler.

Fiat on the other hand, had exercised many options to increase its shareholdings leading to become the full owner of the US company. Fiat had agreed to purchase the Detroit auto manufacturer four years ago but the complete acquisition has been prevented because of a dispute as to the pricing of the shares. This dispute has reached the court and may not be resolved in the next few months.

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