Bye bye Chrysler, another American company destroyed by greedy liberal communist Democrats.

MILAN/DETROIT (Reuters) ? Italian carmaker Fiat SpA struck a $4.35 billion deal to gain full control of Chrysler Group LLC, ending more than a year of tense talks that have obstructed Chief Executive Sergio Marchionne?s efforts to combine the two automakers? resources.
The agreement, announced on Wednesday, cements Marchionne?s reputation as the industry?s consummate dealmaker about a decade after he took the helm of Fiat as a car business newcomer, analysts and bankers said.
But it remains to be seen whether a merger will be enough to cut Fiat?s losses in Europe. Marchionne?s plan to shore up Fiat depends on the ability to share technology, cash and dealer networks with Chrysler, the No. 3 U.S. automaker.
?This is an increasingly American company now, because in Europe, and especially in Italy, the business conditions remain difficult,? said Andrea Giuricin, transport analyst at Milan?s Bicocca University. ?Fiat has already lost many of its market positions in Europe and it won?t be easy to recover that.?
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.
?We thought they were going to have to pay a lot more than that,? a London-based analyst at a major investment bank said. ?The market?s going to love this ? Marchionne?s done it again. He?s brought in a deal that looks like a cracking one on the face of it and he doesn?t need to do a capital increase.?
?DEFINING MOMENT?
Marchionne, who has run both automakers since Chrysler?s 2009 U.S. government-funded bankruptcy restructuring, aims to merge Fiat and Chrysler into the world?s seventh-largest auto group.
But he has been at odds over the U.S. automaker?s worth with the trust, which was pushing for a payout of more than $5 billion. In September, the trust exercised an option enshrined in bankruptcy documents to force Chrysler to file for an initial public offering.
Wednesday?s deal will allow Chrysler to avoid an IPO.
In a statement, Marchionne called the buyout a defining moment for the two companies.
?The unified ownership structure will now allow us to fully execute our vision of creating a global automaker,? he said.
The Chrysler buyout talks have been closely watched by debt and equity investors as Fiat?s long-term plan to cut losses in Europe depends on its ability to deepen ties with Chrysler.
Chrysler is now a profit center for Fiat, but the two companies currently are forced to manage their finances separately. A full merger will make it easier ? but not automatic ? to combine the cash pools of the two companies, giving Fiat more funds to expand its product line-up.
The UAW trust was created in 2007 as a way for General Motors Co , Ford Motor Co and Chrysler to offload their obligations to pay retiree healthcare benefits.
Medical benefits for GM, Ford and Chrysler retirees are handled in separate accounts and each account was initially to be funded with cash. But during the 2009 financial crisis, the VEBA agreed to accept stakes in GM and Chrysler in lieu of cash.
(Reporting by Deepa Seetharaman in Detroit and Stephen Jewkes in Milan; additional reporting by Laurence Frost in Paris, Bernie Woodall in Detroit and Agnieszka Flak in Milan; editing by Anthony Barker and Matthew Lewis)
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Reply to
Roger Wright
Didn't the Ontario and Canadian federal gov'ts have a stake in Chrysler - similar to the stake they had in GM when those companies were bailed out?
I'm still driving my 100% Pure Chrysler made and designed 300m and ->Dodge
Reply to
MoPar Man
Heh.
I AM Canadian.
And I look upon your american health care system - and laugh my ass off.
You couldn't have a more screwed up system if you tried.
And that was BEFORE Obamacare.
Reply to
MoPar Man
I remember they had a shortage of (MRI) Magnetic Resonance Imaging units in Canada and people were dying because of it, so they crossed the border to get access to them.
And then the Canadian PM had his heart surgery here in the USA where the care was so bad. In fact I don't imagine I ever bought a Canadian made car either.
Hugo Chavez was probably thinking in his last moments that he should have thrown Socialism under the bus and gone to America for some really good treatment rather than to Cuba for what turned out to be less than life saving Socialist medical care, and maybe that became the final nail in his coffin. His own Socialism created a failed health care system in Venezuela and he knew it and he went to Cuba where they too had a failed Health Care system.
Why didn't the Canadian PM go to Cuba, I wonder?
Reply to
BeamMeUpScotty

A Spanish surgeon was flown in to treat Castro years ago.
Employees in the UK get extra paid health insurance to get around the long waits there.
Canadian doctors will work week ends at private hospitals to make money outside the socialized system.
Things are not all rosy under socialized medicine.
Reply to
Frank

I have American relatives by marriage who have lived and worked in Canada. The older one and his wife recently retired to the USA but made sure to become Canadian citizens before doing so, so that if faced with high-cost medical treatment in the USA they can always return to Canada for low-cost or even free treatment.
The younger one laments the high cost of health insurance in the USA and reminds us of the paltry cost of her pregnancies and deliveries in Canada -- not to mention the paid pregnancy and maternity leave there.
A while back I saw a TV program about Americans going to Thailand for surgery by US-trained surgeons for a small fraction of US costs.
A radio program a few months back told of a person going to Belgium for a knee or hip replacement (I forget which) that was performed using a US-made device at a cost (including return airfare) that was a fraction of the cost in the USA.
There *are* excellent doctors, surgeons, and hospitals in the USA, but the delivery system is a disaster: that wonderful health care is available only to people with deep pockets, whether it's for paying the "list price" or for paying outrageous insurance premiums.
Perce
Reply to
Percival P. Cassidy
yeah Canadian PM went to Miami
"BeamMeUpScotty" wrote in message news:YXeAu.22928$ snipped-for-privacy@en-nntp-07.dc.easynews.com...
Reply to
Rob

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