Fiat Wants More of Chrysler

After helping American manufacturer Chrysler repay its debt to the American and Canadian government, Italian group Fiat has begun its next offensive, meant to insure that it gets full control of the less productive of the Big Three. (Officially, because unofficially the Italians have been running the show ever since they got the first 20 percent).

Increasing rumors last week point to Fiat going after the government's 6 percent stake, eliminating the government's involvement with Chrysler and at the same time insuring a majority stake. Currently, following the 2009 agreement and the additional stake earlier this year, Fiat holds 46 percent of Chrysler.

According to MSNBC, the price Fiat is going to pay for the remaining 6 percent will be negotiated in the coming weeks, with an official announcement about the buy to be made by the end of next month. By the end of 2011, Fiat is said to be planning another share acquisition, one that would land it a 57 percent stake.

On May 24, Chrysler swapped one debt for another, borrowing from banks to repay the $6.7 billion it owed, plus interest, six years ahead of the deadline. On Tuesday, Chrysler made a payment of $5.9 billion to the US Treasury and $1.7 billion to Export Development Canada (EDC). An extra $2.6 billion from the original loan facilities was undrawn and the facilities have been canceled. All, to the excitement of the American officials.

"Not long ago Chrysler, and hundreds of thousands of jobs, were in danger of vanishing,"
U.S. Sen. Debbie Stabenow, said in a statement. "Now Chrysler has returned to profitability, keeping even more people employed than expected and is again a viable, independent company." 
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About the author: Daniel Patrascu
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Daniel loves writing (or so he claims), and he uses this skill to offer readers a "behind the scenes" look at the automotive industry. He also enjoys talking about space exploration and robots, because in his view the only way forward for humanity is away from this planet, in metal bodies.
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