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Fiat ready to increase its stake in Chrysler

Lingotto CEO Sergio Marchionne has declared his intention to take advantage of the clause that allows Fiat to buy 3,3% of Chrysler every year until 2016 - The first stake would cost the Turin-based company between 150 and 200 million dollars - The stock soars on the Stock Exchange: +20% in one week.

Fiat ready to increase its stake in Chrysler

Chrysler will be increasingly in the hands of Lingotto. The CEO of Fiat, Sergio Marchionne has confirmed his intention to take advantage of the clause which allows the Turin automaker to buy 3,3% of Chrysler every six months in the period between July this year and July 2016. 41,5% of the house in Detroit is now in the hands of Veba, the pension fund of the US trade union Uaw. This first 3,3% that Marchionne would be able to extort from Veba was valued by analysts at between 150 and 200 million dollars and would allow Fiat to reach a 61,8% stake.

The announcement came after a golden week for the Fiat stock on the Stock Exchange. In Piazza Affari, the Lingotto gained more than 20 percentage points in 7 days, returning to the values ​​of mid-April. The purchases benefited from the exploitation of the new investment plan in Brazil and the expansion of the joint venture with Suzuki (read theinsight by Ugo Bertone). Furthermore, good news is expected from the US data on car registrations in May on the US market, which according to some estimates should have increased in the last month.

As for Fiat's takeover of the Detroit giant, Intermonte analysts expect that "closer negotiations between Fiat and Veba will begin in the second half of the year to find a way out of the pension fund". Equita, on the other hand, bets that Marchionne is working to acquire 100% of Chrysler. 

In mid-morning the Fiat stock earn 1,68% at 4,116 euro.

 

 

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