Chrysler headquarters in Auburn Hills, Mich. (Chrysler)
Chrysler and Fiat CEO Sergio Marchionne is nothing if not cagey. When the CEO out-maneuvered the White House in 2009 to strike a great deal to take-over Chrysler with U.S. government loans, it was considered a forgone conclusion that he would eventually take the company public in an initial-public offering. Now, the CEO says an IPO is merely 50-50.

Marchionne says an IPO will be most likely if it cannot buy out the 41% stake in Chrysler held by the United Auto Workers healthcare trust. But, says Marchionne, he would prefer to see the Auburn Hills, automaker merge completely with Italian automaker Fiat over which he also presides.

"My preference is to be one single company," Marchionne told reporters in Kokomo, Indiana, on Thursday. "We belong together." Indeed, the blend of Fiat and Chrysler product development and design has yielded superior financial results, as well as a group of new vehicles that have been met with enthusiasm from both the media and the public.

On Jan. 30, Marchionne said this about the IPO prospect. "In the absence internally of any (solution) at Fiat (to buy the UAW stake), we will be more than happy to accompany [the healthcare trust] to an initial public offering."

Chrysler CEO Sergio Marchionne (Chrysler)

Over the last four years, the two automakers have been blending their operations as Fiat has increased its stake in Chrysler, said Marchionne, who has been CEO of both companies since Chrysler emerged from bankruptcy in 2009.

Fiat, however, has been odds with the trust fund over Chrysler's worth. The fund is under pressure to squeeze as much value as possible from its Chrysler holding to pay for medical benefits for workers and retirees.

A full-on merger with Fiat could be a tough sell to the UAW fund. Not only would it potentially make it harder for them to monetize their holding, but Fiat's prospects in its European home market are bleak. The value of a fully integrated Chrysler-Fiat under one ownership could be punished by investors and Wall Street because it would mean Chrysler's improving fortunes would be bailing out Fiat's falling business.

Marchionne has said Fiat's cash reserve of $14.7 billion is enough to support Fiat's restructuring plan in Europe and a merger with Chrysler.

UAW and Chrysler in Court

Fiat owns 58.5% of Chrysler and has offered to buy another 6.6% from the UAW Retiree Medical Benefits Trust, which owns the remainder of Chrysler. But the Italian automaker sued the trust over the value of those additional shares. Delaware Chancery Court is expected to decide in the next six weeks, Max Warburton of Bernstein Research wrote in a recent report.

Fiat expects to know by the end of March, when the Delaware Judge rules on a lawsuit between Chrysler and the UAW, what a share of Chrysler is worth.

If the Delaware judge rules in Fiat's favor, the UAW trust will push for an IPO to pay for the medical care of retired UAW workers. But if the court decides Chrysler's shares are worth as much as the union's trust contends, then Fiat might want to sell more shares to generate more cash.

Fiat offered $155 million for 54,154 shares last July, then offered $198 million for an additional 3.3% stake earlier this year. The UAW trust claims the shares are worth more than twice as much.

Chrysler hasn't been publicly traded since 1998, when it was acquired by Daimler.

With Reuters

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