Italian automaker FIAT announced Wednesday that it will have complete ownership of Auburn Hills, Mich.-based Chrysler Group LLC after FIAT agreed to buy the remaining shares owned by the VEBA Trust, a UAW trust fund. FIAT will purchase the shares, which account for 41.5 percent of Chrysler Group, in an agreement worth $4.35 billion, Forbes reports. Chrysler Group LLC includes the Chrysler, Dodge, Jeep, Ram, FIAT, SRT and Mopar brands.
The Associated Press reports that FIAT stocks jumped after news of the sale. “Investors cheered the details of the deal, bidding the shares up 12 percent on the Milan exchange. The stock was up by as much as 15.8 percent earlier in the day.”
The sale of the remainder of Chrysler Group to FIAT will help the Italian carmaker expand its lineup of vehicles, Reuters explains. “Chrysler, which Fiat has been running since the bailout deal with the U.S. government, is now a profit centre for Fiat. The Italian carmaker has been hurt by sagging sales in Europe, whereas those in Chrysler's North American home market have risen nearly 50 percent since 2009.”
With FIAT having complete ownership of Chrysler Group, the automaker hopes to better compete on a global scale, Bloomberg reports. “Chrysler and Fiat together delivered 4 million vehicles worldwide in 2012. That compares with 9.07 million vehicles sold by Wolfsburg, Germany-based VW, 9.3 million by GM and 9.75 million by Japanese competitor Toyota Motor Corp. (7203), according to Bloomberg Industries data. Marchionne estimated in June that a merged Fiat and Chrysler will rank seventh in global deliveries.”
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