POST Online Media Lite Edition



 

Fiat gets full control of Chrysler for $4.35 billion

Staff writer |
Fiat SpA struck a $4.35 billion deal to gain full control of Chrysler Group LLC, ending more than a year of talks.

Article continues below






Fiat will acquire the 41.46 percent stake in Chrysler it did not already own from a retiree healthcare trust affiliated with the United Auto Workers union. The trust, known as a voluntary employee beneficiary association or VEBA, will receive $3.65 billion in cash for the stake, $1.9 billion of which will come from Chrysler and $1.75 billion from Fiat.

After the deal closes, Chrysler has committed to giving the UAW trust another $700 million over three years.

The deal is expected to close on or before Jan 20. Fiat said that because of how the deal is structured it will not need to make any capital increase through a rights issue.

The VEBA's payout is less rich than some analysts expected. The sale of the UAW trust's stake values the No. 3 U.S. automaker at less than $9 billion. When factoring in the additional $700 million, Chrysler is worth $10.5 billion.


What to read next

U.S. government sues Fiat Chrysler over excess emissions
Chrysler expected to file for IPO
Fiat Chrysler now has access to $2.8 billion from its U.S. subsidiary