Italy-based car maker Fiat SpA restarted negotiations to purchase the remaining shares of US-based auto manufacturer Chrysler Group LLC
Sergio Marchionne, Chief Executive Officer of Fiat SpA, restarted talks with a United Auto Workers trust to acquire the remaining stake of Chrysler Group LLC, according to three sources familiar with the situation. The said unnamed sources were cited in a report by Bloomberg.
With Chrysler's initial public offering (IPO) on hold, Fiat executives held a meeting this week with the health-care trust representatives, two people said. The meeting came after the trust rejected a higher bid for a 41.5% stake in Chrysler this month, the sources said. According to one person, Fiat first pitched the offer in August, the report detailed.
One of the sources said Turin-based Fiat is now eyeing a $4.2-billion pay for the holding. The trust demands a minimum payment of at least $5 billion for the said shares, the report said.
Marchionne is seeking to merge the two auto makers in 2014 to compete with bigger competitors such as Volkswagen AG and General Motors Co. The Italian car maker needs access to Chrysler's cash resources to fund its turnaround in Europe. Fiat is losing money in the said region because of lack of new models, the report explained.
In 2009, Fiat rescued Chrysler from bankruptcy. The Italian firm presently holds a 58.5% stake in the American carmaker, Bloomberg reported.