Fiat buys rest of Chrysler from UAW; no IPO
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Fiat, owner of Chrysler Group, has agreed to buy the United Auto Workers' remaining 41.46% stake in Chrysler for $3.65 billion, plus four separate payments totaling $700 million.
The agreement, announced today, heads off a public stock sale that Fiat and Chrysler didn't want, but the UAW was forcing, in order to set a value on its stake.
UAW's employee retirement trust -- VEBA -- owns the stake and it and the automakers have been unable to agree on a price. Fiat/Chrysler CEO Sergio Marchionne wants to own all of Chrysler so he can tap its cash to help support ailing Fiat.
That's an ironic reversal. Fiat got control of Chrysler during the Detroit maker's 2009 Chapter 11 bankruptcy reorganization, seen as a savior of Chrysler. But European markets since then have tumbled and Euro brands have been hard pressed to maintain profits.
The purchase will be made by Fiat's Fiat North America unit. The transaction is expected to close on or before January 20.
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