Tag Archive | "Fiat"

Fiat Shareholders Came Close to Merger Upset

Fiat SpA shareholders came close to derailing a corporate reorganization on which the creation of the combined Fiat Chrysler Automobiles group depends, according to data the company released Thursday, reported The Wall Street Journal.

Investors in the Italian auto maker last week tendered shares worth €464 million ($608 million) as they exercised their right to sell their stock to the company, an amount just shy of the €500 million limit that Chief Executive Sergio Marchionne had set for any payout.

Mr. Marchionne had said that he would scrap the reorganization if the payout was any larger, at least temporarily halting the creation of Fiat Chrysler.

With the reorganization now going ahead, the merged company plans to list shares on the New York Stock Exchange Oct. 13, a move designed to give Fiat Chrsyler more flexibility in financing a multibillion-euro expansion plan involving the rollout of several new models.

Fiat also said Thursday that it would sell an unspecified amount of new bonds.

The reorganization involving Fiat and its 100%-owned Chrysler unit includes the merger of Fiat with a Dutch entity which will take the Fiat Chrysler name.

Fiat plans to move its legal headquarters to Amsterdam and take up tax residency to the U.K. as well as have its primary stock market listing in New York.

From Sept. 5 until Oct. 6, Fiat will offer the tendered shares back to shareholders at the predetermined exit price of €7.73 a share. Fiat shares traded in Milan at €7.54 early Thursday.

Fiat said the sale of new debt would come in the form of the reopening of a July bond issue.

At that sale, Fiat sold €850 million in bonds maturing in 2022 that pay 4.75%. The final terms and value of the new bond sale will be based on market conditions at the time of pricing, Fiat said.

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Chrysler Names Bigland to Head Alfa Romeo Brand in North America

Chrysler Group LLC said on Monday its head of U.S. sales, Reid Bigland, has been appointed to lead the Alfa Romeo brand for North America, as it prepares for a relaunch aimed at reaching sales of 150,000 in four years, reported Reuters.

Bigland, 47, joined Chrysler in 2006 as the head of its Canadian operations, a position he continues to maintain. He will be in charge of relaunching the sporty Alfa Romeo brand, which has not been sold in the United States and Canada since 1996.

Chrysler, which is owned by Fiat SpA, also announced that Robert Hegbloom will head its Ram Truck brand. Hegbloom, 50, was also named to its North American leadership team. He joined Chrysler in 1986.

Bigland is also a member of the same North American leadership team as well as being a member of the Fiat Chrysler Group Executive Council.

“Both Reid and Bob have grown tremendously as leaders in the last five years, and the time has come for them to have expanded leadership roles,” Sergio Marchionne, chief executive of Fiat and Chrysler, said in a statement.

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Chrysler Creates Vehicle Safety Office, Puts Veteran in Charge

Chrysler Group LLC on Tuesday announced the establishment of a new office called “vehicle safety and regulatory compliance” led by a veteran company senior vice president, Scott Kunselman, reported Reuters.

The move comes as U.S. automakers are under increased scrutiny over safety issues, and after Chrysler’s cross-town rival, General Motors Co, established a similar office earlier this year.

“This action will help intensify the company’s continuing commitment to vehicle safety and regulatory compliance,” Chrysler said in a statement.

Chrysler is fully owned by Fiat.

So far this year, Chrysler has recalled about 3.2 million vehicles in the United States, while GM has recalled about 25.8 million vehicles.

Prior to the establishment of the new safety office, Chrysler’s engineering group was responsible for vehicle safety and regulatory compliance.

“Effective immediately, this function will be served by a stand-alone organization,” with Kunselman reporting directly to Chrysler CEO Sergio Marchionne, Chrysler said in its statement, as part of the company’s North American executive team.

Kunselman has previously been senior vice president in charge of Chrysler’s North American purchasing and supplier quality. Prior to that, he headed the company’s engineering division, which handled safety and regulatory issues.

In March, GM named a 40-year company veteran, Jeff Boyer, who had been its director of engineering operations, as its new vehicle safety chief in the wake of a series of ignition switch recalls. Boyer reports to GM’s chief executive officer, Mary Barra.

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Fiat Shareholders Approve Reorganization

Fiat SpA shareholders approved a reorganization that opens the way for the Italian car maker that owns Chrysler Group LLC to move its headquarters to the Netherlands, its tax domicile to the U.K. and list its shares in New York, reported The Wall Street Journal.

With Friday’s green light from shareholders, Fiat will now merge with a Netherlands-based entity and take the name Fiat Chrysler Automobiles NV, which reflects its 100% control of Chrysler.

The creation of Fiat Chrysler is a career achievement for Sergio Marchionne, the chief executive of Fiat and Chrysler who took over control of Fiat a decade ago and then brought the company back from the brink in part by engineering the takeover of Chrysler.

Mr. Marchionne has long said that to squeeze the maximum benefits out of the marriage of Fiat and Chrysler—which together are the world’s seventh-biggest car maker—Fiat had to have access to U.S. capital markets through the New York stock listing. A key part of the executive’s plan has also been to have Fiat Chrysler’s headquarters in the Netherlands and tax domicile in the U.K.

With Fiat moving its headquarters after 115 years in Turin, the shareholders’ meeting became a time of reflection for many of them, who peppered Mr. Marchionne and John Elkann, the Agnelli family scion who is Fiat’s chairman, with questions and complaints regarding the move.

One requested a charter flight be made available to shuttle shareholders from Turin to Amsterdam while another lamented the fact that future shareholders’ meetings will be held in English. Many expressed concern that Fiat would be turning its back on the country it has called home since 1899.

“Fiat is not leaving Italy, only the holding company will be organized under the laws of the Netherlands,” Mr. Marchionne said. He added that there wouldn’t be a charter flight for shareholders’ meetings, but that they would be broadcast live.

To meet British requirements allowing its tax domicile in the U.K., Mr. Marchionne and other executives will have offices in London, where future board meetings are scheduled to take place.

The listing on the New York Stock Exchange is slated for the first half of October.

A clause in the merger document gives Fiat shareholders who voted against the tie-up the right to sell their shares to the company at €7.73 a share. Fiat shares traded at €7.24 at the time of the vote. Fiat bond holders also have the right of withdrawal. Fiat has set a maximum payout of €500 million ($669.5 million) to reimburse shareholders’ and bond holders who tender their stock. If that amount is exceeded, the reorganization creating Fiat Chrysler will be nullified.

Fiat shareholders holding 8% of the company’s stock voted against the motion at Friday’s shareholders’ meeting. Those shareholders have 15 days after the results of the meeting are registered, which is expected to be on August 4 or 5, to tender their shares while bondholders have 60 days to sell back their bonds.

About 5% of the total share capital would have to tender its shares by mid-August to reach the €500 million figure, but at that point Fiat could still have a way to complete the creation of FCA. Should the share price rebound and exceed the withdrawal price before the 60-day tender period for bondholders has expired, Fiat could sell previously tendered shares back to other shareholders to lower its payout below the €500 million maximum.

“I’m confident this will go through and if it doesn’t we’ll try again at a later date,” Mr. Marchionne said at a press conference following the shareholders’ meeting. “I’m patient and I have no problem waiting the 60 days to see how this plays out.”

People’s Bank of China deposited 2% of Fiat’s share capital at the shareholders’ meeting, making the Chinese bank the car maker’s fifth-biggest shareholder. It was not immediately known how the Chinese bank—which also owns 2.1% each of Eni, Italy’s largest oil company, and Enel, the country’s dominant utility—voted its shares at the Fiat meeting. The Agnelli family is Fiat’s largest shareholder, with a 30% stake.

Fiat and Chrysler sold 4.4 million vehicles combined last year, an amount forecast to jump to 7 million in 2018, according to an ambitious business plan released by Fiat in May.

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Rick Case Appointed First South Florida Alfa Romeo Dealer

Weston, FL — Rick Case Automotive Group has added Alfa Romeo to the group’s growing repertoire of brands, which include Volkswagen, Acura, Audi, Hyundai, Mazda, Kia and Honda Cars & Cycles.

To celebrate the unveiling of the new store, which will take place in August, the group will donate the first 2015 Alfa Romeo 4C to live auction, with 100% of the bid amount over MSRP being donated to the winning bidder’s charity of choice.

“Alfa Romeo has long been recognized as an enthusiast brand name in the automobile world and is now reemerging as a major supercar contender in the U.S. market,” said Rick Case of the Rick Case Automotive Group. “We are thrilled to be at the forefront of this reemerging brand that is the hottest new car to hit the United States automotive market in years.”

Alfa Romeo, owned by FIAT Chrysler Automobiles, is an Italian-American automobile company that dates back to 1899. FIAT Chrysler Automobiles is made up of 13 companies, including FIAT, Chrysler, Dodge, Jeep, Ram, Alfa Romeo, Ferrari, Maserati, Abarth, Lancia, Iveco trucks, Case and New Holland tractors and heavy equipment.

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Fiat Chrysler Says Performance of US Operations Crucial

Fiat Chrysler Automobiles Chief Executive Sergio Marchionne said on Sunday a good performance by its U.S. operations was crucial for the success of the company’s recently announced business plan, according to Reuters.

The carmaker launched a breakneck global growth effort last month built around its upmarket Alfa Romeo, Jeep and Maserati brands. Under the 2014-2018 business plan, it aims to boost sales by 60 percent and increase net profit five-fold by 2018.

“The execution of the (Fiat Chrysler Automobiles) business plan announced on May 6 depends on the fact that the U.S. operations perform well,” Marchionne said at a business event in the Italian town of Trento.

Marchionne said the company needed cash from Chrysler’s U.S. operations to fund its strategy in Europe, where Fiat was still battling with a weak and fragile economic recovery and over-capacity of the market for mass-market brands.

Chrysler filed for bankruptcy in 2009 and received a U.S taxpayer-funded bailout. Fiat took over the U.S. automaker at the time and completed the buyout at the beginning of this year to become the world seventh-largest carmaker.

The group is preparing to move its main listing from Milan to New York by the end of this year.

Marchionne said Chrysler’s financial strength and commercial clout overseas would help Fiat boost sales of Alfa Romeo, which will build eight new models by the end of 2018 thanks to investments worth 5 billion euros ($6.8 billion).

“On Friday I saw the prototype for one of the new models engineers are developing in secret, and I can say we are on the right track,” he said, adding that the model would probably be unveiled in the third quarter of next year.

Marchionne confirmed that all Alfa Romeo cars would be produced at Italian plants, at least until 2018, and said he would ask the government of Prime Minister Matteo Renzi to take measures to facilitate exports.

“I am not asking for financial aid. I am asking for logistic, regulations … changes to help exports,” Marchionne said, lamenting that he had not received any such help from Renzi’s predecessors.

Marchionne, who in the past ignored opposition from Italian labour unions and industry lobby Confindustria to negotiate company-level job contracts at Fiat plants, voiced support for the 39-year-old Renzi, who took office in February.

“I like Renzi very much, I hope he will find support for his agenda … it is the only agenda we have both in Italy and in Europe,” Marchionne said.

Renzi has promised to try to focus euro zone policies on growth and employment and away from austerity during the six months that Italy will hold the rotating European Union presidency starting in July.

“The austerity that came from Germany doesn’t make any sense for Europe now,” Marchionne said.

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