According to two people that spoke with Bloomberg, Fiat SpA aims to increase its stake in Chrysler Group to 30 percent within the next few weeks after it clears two U.S. government demands linked to receiving increased share holding.
Fiat has met the second demand of $1.5 billion in revenue outside North America at Chrysler since Fiat took a stake in the Auburn Hills automaker, one of the two people said.
Currently, Fiat owns 25 percent of Chrysler and will get an additional 5 percent of the U.S. government’s holding in the company after the Treasury Department is satisfied that the two demands have been met. The increase will help CEO Sergio Marchionne reach his goal of a 51 percent stake by the end of 2011.
Fiat will be getting the first 35 percent without putting out any cash and must purchase the other 16 percent. For the remaining 16 percent, Fiat must pay $1.14 billion if Marchionne makes the purchase this year and $1.37 billion if it makes it next year.
– By: Omar Rana
Source: Automotive News