The Board of Directors of Fiat S.p.A. announced that it has approved the plan governing the merger of Fiat into a wholly owned subsidiary. The new entity will be renamed Fiat Chrysler Automobiles N.V., with FCA to become the holding company.
If you rewind a few months, you might remember that this reorganization plan was first announced on January 29, 2014, when Fiat acquired the remaining equity interest in the Chrysler Group LLC. So what's the catch with this merger plan? As simply put as possible, it is designed to give the Italo-American group an appropriate corporate, investment and capital markets profile.
By including provisions for Fiat shareholders, one Fiat share will transform to one share of the FCA's common stock. Another change this merger introduces is that FCA will adopt a loyalty voting structure which gives shareholders double the voting power, with two votes for every share of the group's common stock. Shareholders of both Fiat stock and those who have held stock for at least three years are included in this voting structure.
According to an official statement, the merger plan will be submitted for approval at an extraordinary general meeting slated to take place in the 3rd quarter of 2014, with the transaction expected to be completed by the end of 2014. Fiat S.p.A. also announced that today it has approved a bond issuance amounting to $5.4 billion.
By including provisions for Fiat shareholders, one Fiat share will transform to one share of the FCA's common stock. Another change this merger introduces is that FCA will adopt a loyalty voting structure which gives shareholders double the voting power, with two votes for every share of the group's common stock. Shareholders of both Fiat stock and those who have held stock for at least three years are included in this voting structure.
According to an official statement, the merger plan will be submitted for approval at an extraordinary general meeting slated to take place in the 3rd quarter of 2014, with the transaction expected to be completed by the end of 2014. Fiat S.p.A. also announced that today it has approved a bond issuance amounting to $5.4 billion.