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Italy's Fiat stocks soar after announcing full control of Chrysler

English.news.cn   2014-01-02 21:26:06            

MILAN, Italy, Jan. 2 (Xinhua) -- Italy's car maker Fiat stocks soared 15.8 percent in early trading on Thursday, a day after Fiat reached an agreement with the United Auto Workers (UAW) to purchase the remaining 41.5 percent shares of Chrysler Group LLC for 3.6 billion U.S. dollars.

The full control of the American carmaker was made final after more than a year of negotiations with VEBA, the healthcare trust associated with the UAW.

Fiat and Chrysler will fund the purchase of the UAW trust shares in the company for an aggregate amount of around 1.9 billion dollars up front and a second cash payment of 1.75 billion dollars when the deal closes on Jan. 20, according to local reports.

Besides, Chrysler will pay the UAW trust 700 million dollars in four equal annual installments, with the first payment due on Jan. 20.

Fiat, which currently owns 58.5 percent of Chrysler, had been looking forward to this day from the very moment when "we were chosen to assist in the rebuilding of a vibrant Chrysler back in 2009," Fiat Chairman John Elkann was quoted by ANSA news agency as saying in a statement.

The Italian carmaker took control of Chrysler in 2009 as the third largest U.S. automaker emerged from a government-financed restructuring under bankruptcy protection.

After winning a 20 percent stake in exchange for sharing technology and leadership, it expanded its control by purchasing shares owned by the American government and VEBA.

In 2012, Fiat CEO Sergio Marchionne expressed the interest in buying all of Chrysler. The CEO said in 2013 that he expected to complete the merger this year. (1 euro = 1.3 U.S. dollars)

Related:

Fiat moves to buy Chrysler's remaining stake

CHICAGO, Jan. 1 (Xinhua) -- Italian automaker Fiat SpA reached an agreement Wednesday with the United Auto Workers (UAW) to purchase the remaining 41.5 percent shares of Chrysler Group LLC for 3.65 billion U.S. dollars.

Under the agreement, Fiat and Chrysler will fund the purchase of the UAW trust shares in the company for an aggregate amount of approximately 1.9 billion dollars up front and a second cash payment of 1.75 billion dollars when the deal closes on Jan. 20. Besides, Chrysler will pay the UAW trust 700 million dollars in four equal annual installments, with the first payment due on Jan. 20, the Detroit News reported.  Full story

 

 

Editor: Hou Qiang
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