Sergio Marchionne, CEO of both Chrysler and Fiat, made an announcement saying that Fiat will be digesting its non-automotive industrial business, as it gets the approval of the investors. Earlier, the shareholders approved on the plan of Fiat divesting the industrial and marine operations into Fiat Industrial.
On Thursday, Marchionne said that Fiat would be increasing its shares in Chrysler from 20%, which Fiat took acquisition of in 2009, to 25% by December. The shareholders granted Fiat Group their approval on the move. By 2011, Marchionne would be further increasing the stake to 35% by the end of 2011. As a result, Marchionne said that Chrysler would be publicly selling its shares by the next year.
Marchionne added, “The demerger of the group and the creation of two separate entities will finally solve a strategic issue that has for years been a thorn in the side of Fiat”.
The automobile business currently include, Fiat Lancia, Alfa Romeo, Ferrari, Maserati, in addition to the auto part providers Magneti Marelli and Teksid, adding to that Comau robotics and FPT Powertrain Technologies.
Michael Tyndall, an auto specialist at Nomura International in London, said that the European automakers are more likely to trade between 15% and 40% of the sales.
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