The Chief Executive Officer of Fiat SpA – Mr. Sergio Marchionne revealed in front of reporters that the company intends to sell holdings that are estimated at about 602 million euros (820 million dollars). According to Mr. Marchionnes announcement, this move of the car manufacturer is provoked by its motivation to free up cash in order to become more focused on the expansion of its luxurious brands, Maserati and Alfa Romeo.
Chief Executive Officer Mr. Marchionne said in the companys statement, which was cited by the Financial Times: “We are going to get rid of those shares . . . We need to start creating liquidity in the US market. We want to create a large shareholder base in the US, because we see them as our home market.” As reported by Bloomberg, the Chief Executive Officer of Fiat also added: “The Chrysler story is one investors have followed from the beginning. We were the poor kids, Cinderella at the ball. People in the U.S. actually like that. They like what happened. We paid all the money back and it was clean.”
The Fiat-Chrysler Automobiles, which will be formed later in 2014, has revealed its plan to list the combined shares in New York by October this year. Fiat has decided to sell its Treasury holding that amounts to about 3.5% and its CNH Industrial holding that amounts to 2.5%.
According to a person with knowledge of the matter, Chief Executive Officer Marchionne also cancelled the plans to transfer 500 dismissed employees from the Turin-based Fiat factory to a Maserati plant, which is located in the area. This decision comes only several days after a one-hour strike of about 200 workers from the Fiom metalworkers union took place at the Maserati plant, who opposed against general working conditions.
Fiat SpA was adding 0.53% to trade at 7.62 euros per share by 12:56 GMT, marking a one year change of +44.36%. According to the information published on the Financial Times, the 23 analysts offering 12-month price targets for Fiat SpA have a median target of 7.00, with a high estimate of 10.50 and a low estimate of 4.00. The median estimate represents a -7.59% decrease from the last price of 7.58.
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