Fiat Planning to Sell-Off Ferrari to Finance Further Chrysler Ownership

[steelstallions]

http://www.autoguide.com/auto-news/2010/09/fiat-planning-to-sell-off-ferrari-to-finance-further-chrysler-ownership.html


Fiat is considering a partial sale of Ferrari in order to finance further ownership of U.S. automaker Chrysler. As insane as the idea is of selling some of what might just be the best and one of the most profitable automakers in the world in order to purchase a further stake in one of those held in the lowest esteem and with some of the largest financial hurdles, that is reportedly the case according to Il Corriere della Sera, an Italian daily newspaper.

Fiat has denied the reports, but the paper’s sources inside the company hint at the truth, indicating that it might take such a drastic move in order to achieve a controlling 51 percent share in Chrysler. Ferrari is said to be worth $3.1 billion and would still say in Fiat’s hands thanks to a 51 percent ownership.

Currently Fiat owns 20 percent of Chrysler but is expected to increase that amount to 35 percent once it meets certain restructuring regulations laid our by the U.S. treasury.

Fiat’s interest in Chrysler extends beyond the scope of the actual company with Fiat CEO Sergio Marchionne eager to secure his company in the North American marketplace.

Are they freeking INSANE!!!!!!!!!!!!!!!!!, Sell some of the golden goose for more of that dead donkey Chrysler outfit, this better be a hoax :-E

[Tifoso]

You can say that again.

[siberianlady]

That is sacrilege.

[Greig]

Good maybe Pierro will buy the shares they are willing to sell :-)

I don't think Fiat has any shares in the F1 division of Ferrari, I am sure Agnelli made sure of that :-)

[siberianlady]

Well if they do float some of Ferrari I want some shares! How about a Tifosi action to buy whats on offer? Would be awesome although just a dream.................

[Tifoso]

Good maybe Pierro will buy the shares they are willing to sell :-)

I don't think Fiat has any shares in the F1 division of Ferrari, I am sure Agnelli made sure of that :-)

Excellent :-)

[NJB13]

Excellent :-)

+1

[Italian Spirit]

I didn't find anything in the Corriere della Sera. The move would definitively be one of the most demented ever in the history of automotive.

Sergio Marchionne put Fiat back on track the way he did with quite few other ailing companies. The problem with him is the touch of megalomania. He considers Europe to small for his ego. But instead of trying to move where the automobile future is (China, India...) he decided to conquer the USA.

Somebody should tell him that you can't win at Ascot riding a donkey.

[Agron]

Even if Ferrari provides great profits and Chrysler doesn't, maybe under the proper direction they can make both earn money, and the potential revenue of Chrysler is far bigger than that of Ferrari, as much as Ferrari is diversifying their business.
Let's hope it doesn't cost Fiat, Mercedes tried with little luck, at the very least I'm sure they are aware of the risks and they believe they can make it work.

[ferrari4life]

US is a big market for cars sales..
makes sense that they would want a bigger piece of it right?

[RedRebel40]

the profit they make goes to FIAT with their crap cars. maybe this is better

[Tifoso]

1. Chrysler cars suck.

2. I would imagine this would be a move toward having a FIAT USA (which makes better sense). So many beautiful cars.

3. Luca di screwed Juventus and Michael without batting an eyelash. Why would Ferrari be any different?
a. it is possible that he is doing this to "save" Ferrari for when he (and they? ) buy F1 from Bernie

b. if a. , then I apologize

[Tony]

I think the article is trying to imply that Fiat will sell off some of it's shares in Ferrari to the point where it still own 50%+1 of the voting shares of the company and continues to have controlling interest in the Board of Directors.... from there the money they receive from the sale will be pumped into Chrysler to obtain control of that company @50%+1 of their voting shares....

Control does not necessarily mean 100% ownership and even in some cases, a majority shareholder can have control if they own less than 50%+1 of the voting shares if the remaining shares are widely dispersed (this is rare however)....

At the end of the day, Ferrari would still belong to Fiat and so would Chrysler.... as it stands, I think the US government owns a significant percentage of that company....

[raylinds]

Looked at from an investment perspective, this could make sense. A lot of investors like Warren Buffet, Carl Icahn, and others have made a fortune by buying poorly run companies dirt cheap and turning them around by replacing managment, etc. If (and it's a big IF) Fiat could do that with Chrysler, it could be highly lucrative. Buying a company that is out-of-favor and doing poorly has greater profit potential than a well run successful company that is favored by investors, BUT it is much riskier. More risk = more potential reward.

That being said, I have serious doubts that Fiat can pull it off.

[Tony]

If they can achieve economies of scale by sharing platforms while exploiting the goodwill associated with the cinquecento and the alfa romeo brand then it could possibly work.... the only drawback here is the reliability concerns with Chrysler.... unfortunately, that same issue is echoed within Fiat....

[Tifoso]

I love the Alfa's. Would be great if they were more readily available here. Beautiful cars. :-)

[REDARMYSOJA]

3. Luca di screwed Juventus and Michael without batting an eyelash. Why would Ferrari be any different?


I don't know what Luca would have to do with it since he stepped down as chairman of FIAT awhile back.

This wouldn't be the first time FIAT has sold off shares of Ferrari. They did it in 2002 selling 5% to Mubadala and 34% to Mediobanca, but later bought back the 34%.

This story says FIAT first wants to increase it's share in Ferrari by buying Mubadala's 5%



Fiat SpA may sell shares of Ferrari SpA in an initial public offering to help fund the purchase of more stock in Chrysler LLC, daily Corriere della Sera reported, without saying where it got the information.

Fiat first wants to raise its stake in Ferrari to 90 percent by buying 5 percent held by Mubadala Development Co., according to the Italian newspaper. Ferrari might be valued at 3.1 billion euros ($4.2 billion) according to the newspaper.

Fiat Chief Executive Officer Sergio Marchionne said Sept. 16 at a shareholders’ meeting in Turin, Italy that the company wasn’t planning a Ferrari now. He also said then that Fiat was still in negotiations to raise its Ferrari stake to 90 percent.

[Nathan]

So...are they buying or selling Ferrari?

[ali355]

Classic case of 2+2=5. If you read the original interview you will see that Marchionne was kicking around some ideas, which include buying back the stake in Ferrari that they sold a while back (to Mubadala I think?) to go back to a 90% stake for FIAT, and even floating Ferrari on the stock market. So I wouldnt worry too much just yet!

[Tifoso]

I would love to see Ferrari on the stock exchange. Imagine the stock certificate :love

[Tony]

So...are they buying or selling Ferrari?

According to the article, which is more conjecture than anything they would be selling their shares but still retaining a controlling interest....

[Tony]

I love the Alfa's. Would be great if they were more readily available here. Beautiful cars. :-)

I think Marchionne said that Alfa would also be available in the US.... from some of the rumours i've read, the new dodge viper will be based on the alfa romeo 8c competizione....

[Italian Spirit]

I love the Alfa's. Would be great if they were more readily available here. Beautiful cars. :-)

You're not the only one that loves Alfa, amico caro! :-)

Volkswagen loves Alfa too, so much so that Mr Piech would really like to buy it. A teutonic Alfa, heaven forbid! :roll They will will make it square, heavy, overpriced, as ugly an a Audi TT and take away 99% of the Alfa Romeo fascination. :-s It will not happen, but if... than I would get rid of my Brera on the spot.

Since you read italian Tifoso, check into the daily Il Sole-24 ore you can read plenty about it and about how FIAT wants to buy back 5% of Ferrari shares from Mubala.

Search for Fiat Chrysler Alfa Ferrari and you'll be up-to-date

[coolrunnings_99]

Romeo loved Julliet, as much as I loved all my alfas.
The say Julliet loved him back, but I aint buying that.

The thing is, love affair with Alfa Romeo is by far more tantalizing then, a love affair with Honda or Saab, Volvo, BMW etc..
Also true, as in all do or die love affairs (is there a different kind?), it gets pretty much one way, that is you loving your Alfa, and she s just gone for a short breakfast at Tiffanys;-)
And IMHO, that applies to all alfa cars built after late seventies.

Now, the Alfa Romeos, of the 40ties, 50ties, 60ties vintage...nothing will, and just simply cannot come close to it, not even in ones wildest dreams.

To get back on topic, ehem, is there a mass produced car in the past 20 years that lives up to its heritage?
Volvo thats actually a Renault, wich is actually a Nissan, wich could be a Toyota, or a Peugeot.A Mitsubishi that is actually a Citroen.A Jaguar that is a Ford in disguise, a Fiat that is an Opel, a Honda that could be a Vauxhall.
A Lancia, that is Fiat, that is Alfa, and could be a Chrysler, or an Opel.
In all, or in just a couple of modular components.

:HmmMy "new" car is going to be somewhere between 15-35 years old


bye cool...

[xpman]

so know that Lemmon Brothers are Bust who owns there 7% stake in Ferrari?

[ali355]

As of 2008, Fiat Group owns 85% of Ferrari, Mubadala Development Company owns 5%, and Enzo's second son Piero Ferrari owns 10%. Of these, Ferrari is under main control of the Fiat Group, containing Alfa Romeo as well.

That's off Wikipedia so may not be totally correct