#baillout
Fiat And Chrysler: Alone At Last
Fiat split its auto business from the rest of its industrial operations today, creating two new companies: Fiat and Fiat Industrial. Fiat CEO Sergio Marchionne announced the move as a way for Fiat to unlock its share value and concentrate on its core business, telling the AP [via Newser]
This is a very important moment for Fiat, because it represents at the same time a point of arrival and a point of departure. Faced with the great transformations in place in the market, we could no longer continue to hold together sectors that had no economic or industrial characteristic in common.
But with Fiat Industrial taking care of the truck-and-tractor side of the business independently, Fiat SpA is focusing on the task at hand: Chrysler. With a 35 percent stake in the bailed-out American automaker in the bag, Fiat is aiming for a controlling stake when Chrysler’s IPO hits the markets later this year. And though the spin-off of FIat’s non-automotive business opens the door for a full merger of Fiat and Chrysler, Marchionne denies that a full merger will take place, saying only that
I don’t know whether it is likely, but it is possible that we’ll go over the 50 percent mark if Chrysler decides to go to the markets in 2011. It will be advantageous if that happens.
But don’t mind Sergio’s equivocation. Fiat will almost certainly snap up the remainder of a controlling stake by the end of this year. Here’s why…
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