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Chrysler Rumored to be in Talks with Italian Automaker over Stake

New York (HedgeCo.Net) – Italian automaker Fiat S.p.A. may be interested in acquiring a stake in Chrysler that could help lift the U.S. automaker out of financial distress.

According to an article published on autonews.com, Fiat may invest in a 30-35% stake in Chrysler, while helping the company to design vehicles that create fewer emissions.

While the website didn’t cite specific sources, Chrysler is maintaining ambiguity by stating they do not “confirm or disclose the nature of its private business meetings.”  They also downplayed the situation by saying that, “In today’s economic environment, talks are going on between companies in all industries – ours is no different.”

Chrysler, who has already received $4 billion in rescue funds from Uncle Sam, shut down production in all of their U.S. plans in December until inventory is moved.  Many fear that Chrysler cannot weather the storm unless they align themselves with a partner.   

Fiat would provide new engine and transmission technology that would help Chrysler to produce more fuel-efficient vehicles that pollute less, said people familiar with the matter.

Private equity firm Cerberus Capital Management currently holds an 80.1 percent stake in Chrysler, while Daimler holds the remaining 19.9 percent.

Julie Scuderi
Senior Editor for HedgeCo.Net
Email: julie@hedgeco.net

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