• Jan 2nd 2014 at 7:51AM
  • 121
Fiat strikes deal with UAW to buy remaining Chrysler sh... Fiat strikes deal with UAW to buy remaining Chrysler shares (AP Photos/Michael Probst, file)
Fiat Inks $4.35 Billion Chrysler Deal

Italian automaker Fiat SpA announced Wednesday that it reached an agreement to acquire the remaining shares of Chrysler for $3.65 billion in payments to a union-controlled trust fund.

Fiat already owns 58.5 percent of Chrysler's shares, with the remaining 41.5 percent held by a United Auto Workers union trust fund that pays health care bills for retirees.

Under the deal, Fiat will make an initial payment of $1.9 billion to the fund, plus an additional $1.75 billion upon closing the deal.

Chrysler will also make additional payments totaling $700 million to the fund as part of an agreement with the UAW. The deal is expected to close on or before Jan. 20, according to a statement from Chrysler.

Sergio Marchionne, CEO of both Fiat and Chrysler, has long sought to acquire the union's shares in order to combine the two companies.

"The unified ownership structure will now allow us to fully execute our vision of creating a global automaker that is truly unique in terms of mix of experience, perspective and know-how, a solid and open organization," Marchionne said in a statement issued by Turin, Italy-based Fiat.

The deal eliminates the need for an initial public offering of the union fund's stake, which analysts had previously valued at $5.6 billion.

Fiat went to court last year seeking a judgment on the price, but the trial date was set for next September.

Marchionne can't spend Chrysler's cash on Fiat's operations unless the companies merge. In recent months he made it clear that he preferred to settle the dispute without an IPO, but filed the paperwork for the offering in September at the trust's request.

Chrysler's profits have helped prop up Fiat on the balance sheet as the Italian automaker struggles in a down European market.

The Auburn Hills, Mich., automaker earned $464 million in the third quarter on U.S. sales of the Ram pickup and Jeep Grand Cherokee, its ninth-straight profitable quarter. The results boosted Fiat, which earned $260 million in the quarter. Without Chrysler's contribution, Fiat would have lost $340 million.

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    • 1 Second Ago
      • 1 Year Ago
      • 1 Year Ago
      Eliminating the union ownership a great way to grow the company. Aka, grow jobs. Fiat has taken the right road. Meanwhile, GM has taken the money and ran, stiffing the US taxpayers for the remaining. $10.5 billion owed. And, Meanwhile, another lie by Obama about jobs saved-GM putting up plants in China to make parts and cars. Rather long commute for those UAW workers, eh?
        • 1 Year Ago
        Before there was a President Obama,GM and other were moving job out of America to other country to make more money and to keep from paying tex to the US and this is nothing new, they have been making car's over sea for year,and as for Obama /America Government helping GM I am so glad it did because GM in St.Louis,MO.put on more worker full time then they had in years and after 15 years as a part time worker my niece had a full time job with all the benefits that come with having a full time job.God bless American and President Obama for putting American worker first and saving and keeping so many job here in America and in St.Louis,MO.and if nothing else I think him every day for that.
      • 1 Year Ago
      Has the tax payers money from the bail out been repaid in full? I don't know for sure. If not how can it be sold to an overseas company with out that provision being stipulated in the deal.
      • 1 Year Ago
      China, Make room for Chrysler, Maybe beside the GM Plant. The next thing you know childern will be building Chrysler Mopars,, and Goverment Motors , I ment General Motors cars. Cheap labor means cheap cars/trucks. GO FORD!
      • 1 Year Ago
      Thanks to our half breed muslim IIC, I will never buy another chrysler product......
      • 1 Year Ago
      I guess we now have the Big 2 in the U.S., Government Motors (GM) and Ford. I hope the U.S. taxpayer won't have to save Fiat/Chrysler in the future.
      • 1 Year Ago
      Hmmmm, cheap Chrysler crap vehicles, produced to sell (not last), with hundreds of engineered flaws in them, purposely designed to keep you running back to get it fixed ($$$ for Chrysler) (which are not covered in their warranties), now being merged with a car company that produces some of the most gawd-awful looking tin can coffins on the roads now. I can only deduce that the next generation of Crappy Chryslers will be monstrosities of ginormous proportions.
      John Montgomery
      • 1 Year Ago
      Why do people attack a company that in a government approved partnership has helped bring Chrysler back to life, repaid all government loans? Fiat picked up the pieces after Mercedes bailed and Cerberus Capital left it for dead. Fiat rescued Chrysler when NO ONE else would touch it with a 10 ft. pole. It saved 300,000 jobs at Chrysler and second tier suppliers, most American jobs based here. Fiat got 20% up front, but BOUGHT their way to 58.5% share and REPAID every penny of the high interest loans to the government and taxpayers 6 years early. Fiat does no owe taxpayers a penny. GM certainly does! Fiat not only turned around Chrysler but greatly improved quality. Check the awards, new Chrysler profits and positive owner surveys. Fiat invested in American soil based assembly plants making Chrysler cars and trucks for long term job preservation and growth of American jobs. Chrysler EXPORTS Jeeps and other models like the Chrysler 200 (sold as a Lancia) to Europe. Cars made HERE and sent over THERE. Fiat also owns 100% of recognized quality brands like New Holland Tractor, Case Backhoes, Kobelco Construction Excavators, FPT Powertrain Technologies, Magnetti Marelli electronic systems, and Ferrari, Maserati, Alfa Romeo, Lancia auto brands. Fiat showed willingness in invest in America as they and independent dealers built over 210 Fiat Studios since 2010 to sell the domestic content laden Fiat 500.. The Fiat 500 engine made in Dundee, Michigan, received the 2010 "International Engine of the Year". The Fiat 500 is one of the safest, high mileage non hybrid gas engine vehicles in America today and outsells the Mini Cooper brand since summer 2011. Americans work at these dealerships. Fiat is the #1 European manufacturer in low CO emission green friendly vehicles and the leader by far in natural gas vehicles. Anyone read Motor Trend magazine lately? The Ram 1500 Pickup Truck (40% of US market is pickups) just got the 2014 Motor Trend Truck of the Year award. This Ram 1500 with the 3.0 liter V-6 Eco-diesel motor (made by Fiat in Italy) and coupled with the new 8 speed transmission tows up to 9200 lbs. and gets a WHOPPING 8 MPG more that Ford or Chevy's similar truck with diesel engines. See Motor Trend's February 2014 issue, page 76, 77, 78. Sergio Marchionne's leadership is a great example of what is still possible in America...It can't be changed in spite of folks trying to bend history or invent facts to support an agenda driven bias or pure ignorance of the facts. The announcement will bring more net jobs to America, especially since labor factors in Europe are much more difficult to control. Anyone still have a problem with investing in America?
        • 1 Year Ago
        @John Montgomery
        Er ah because FIATS suck?
        • 1 Year Ago
        @John Montgomery
        Mama Mia! Now your American dollars will go to Italy when you buy a Chrysler! Just like your dollars going to Japan when you buy Honda, Toyota, or Nissan. Or South Korea when you buy a Kia or a Hyundai. We now have the Big Two. Boycott Chrysler like you do Toyota, Honda, Hyundai, BMW, Volvo, Mercedes. All your money goes overseas!
          John Montgomery
          • 1 Year Ago
          Perhaps it would have been better to close all 3200 Chrysler dealerships in 2009? Better to lay off 300,000 workers, right? Lets close all the Wal Marts too, that money goes to China. Let's close all the gas stations, that money goes to the middle east. Let's garish illegal alien's US made income, that money goes back to their home countries tax free. Lastly, let's buy all of our cars from General Motors, then let the American dollars disappear down a black hole like our taxpayer funded loans did in 2009. GM still owes us taxpayers!
      • 1 Year Ago
      Swell, the next bailout can go directly to Europe. No "Pass Go" - just start writing checks in Euros.
      • 1 Year Ago
      Fiat will be building jeeps in China,,,,just like Romney said...so instead of building jeeps here in America and shipping them over-seas they will be built in good old polluted China...so more Americans will be out of work!!
      • 1 Year Ago
      Americans don't make cars anymore, they just assemble them!
      • 1 Year Ago
      It means more jobs to go overseas
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