Court Okays Chrysler Assets Sale to Fiat

This is probably the only good news for Fiat these days as the Italian automaker lost the battle with Magna International and its Russian partners over the acquisition of Opel. A federal bankruptcy judge approved late Sunday night the Chrysler assets sales to Fiat which means the strategic alliance between the two companies can go further. However, getting the court's OK wasn't such an easy job for Chrysler as the proposal faced no less than 300 objections from creditors, states' Attorneys General and pension fund groups, according to theautochannel.com

Nevertheless, Fiat is now allowed to purchase a stake in the American manufacturer which is currently under the protection of Chapter 11 in the United States.

As announced in January this year, Fiat and Chrysler will form a strategic alliance that is believed to help the Detroit-based manufacturer survive in this current difficult economic environment. Additionally, Fiat would take a stake in Chrysler and will use the company's dealership network to expand its coverage in the United States.

Chrysler on the other hand is projected to benefit from Fiat's assembly lines which are more appropriate for recession times as they mostly roll off small cars, more focused on fuel economy and CO2 emissions than Chrysler's current models.

"A Chrysler/Fiat partnership is a great fit as it creates the potential for a powerful, new global competitor, offering Chrysler a number of strategic benefits, including access to products that compliment our current portfolio; a distribution network outside North America; and cost savings in design, engineering, manufacturing, purchasing and sales and marketing," said Bob Nardelli, Chairman and CEO of Chrysler LLC, back in January.