Fiat SpA Works to Expand Chrysler Hold


Bloomberg News - February 12, 2013

Fiat SpA is said to be dis­cussing financ­ing options with banks to strengthen its bal­ance sheet in prepa­ra­tion to buy the Chrysler Group LLC stake it doesn’t own.

Find out what CEO Ser­gio Mar­chionne is work­ing on.

Ser­gio Mar­chionne, chief exec­u­tive offi­cer of both automak­ers, has held talks with banks to help pay for at least some of the 41.5 per­cent held by the United Auto Work­ers med­ical ben­e­fits trust for Chrysler retirees, said the peo­ple, who asked not to be iden­ti­fied because the talks are pri­vate. A final deal may take months because Fiat and the trust dis­agree over the value of the shares, they said.

Mar­chionne is eval­u­at­ing options that include a bridge loan to com­plete the deal, two of the peo­ple said. The Ital­ian car­maker may pay around 2.23 bil­lion euros ($2.98 bil­lion) to buy the remain­ing stake, accord­ing to an esti­mate from Gold­man Sachs Group Inc., which sees a deal pos­si­ble within 12 months.