Fiat is increasing its stake in Ferrari, buying back the shares it sold to Italian investment bank Mediobanca during Fiat's financial troubles in 2002. The Turin-based auto conglomerate is the undisputed Don of the Italian car business, controlling Ferrari, Maserati, Alfa Romeo, Lancia, Iveco and Magneti Marelli (to name a few), and will exercise its option to buy back the 29% currently held by Mediobanca by the end of September.

Together with the 56% it currently holds, this will bring Fiat's stake in Ferrari up to 85%. Mediobanca sold 5% to Mubadala Development Company, a UAE crown corporation; shares which Fiat may or may not buy back. (Mubadala also owns stake in Spyker, fuelling rumors that the recently acquired Spyker MF1 team could switch to Ferrari power for next season.) The remaining 10% is still owned by the Ferrari family.

Enzo Ferrari initially sold half his company to Fiat in 1968. While ostensibly Fiat owns Ferrari, many would argue the control flows the other way, with Ferrari president Luca di Montezemolo serving as chairman of the Fiat Group.

Think buying one Ferrari is expensive? Fiat's purchase is rumored to cost a staggering $800 million.

[Source: Ansa.it via Italiaspeed]