Merger may delay because of Chrysler IPO - Fiat CEO Marchionne
Addressing reporters at an event in Turin, Fiat SpA chief executive Sergio Marchionne said that the merger between Italian automobile manufacturer and Chrysler Group LLC might take a long time before it would happen. Marchionne runs both Fiat and the US automaker.
The terms of the merger between both automakers would have Fiat purchasing Chrysler's shares from United Auto Workers's (UAW) trust. Marchionne said the retiree healthcare trust may be selling its 41.5% stake in Chrysler via an initial public offering. Fiat would be purchasing the trust's stake in Chrysler at a market price per share, he said.
Fiat and UAW's trust has been battling in court to reach an agreement of the valuation of the Chrysler stake the UAW owns. Fiat has options to buy the holding. In compliance with UAW's request, Marchionne has been making preparations for a potential IPO for Chrysler at the same time.
When asked why he did not attend the auto show in Frankfurt, Germany this week, he confirmed his absence. He said he has an engagement that needs his attention, but he did not disclose any further details.