Fiat-Chrysler deal likely to be completed today
SOUTHFIELD, Mich. - A group led by Fiat SpA will complete its purchase of most Chrysler LLC assets this morning New York time, after the Supreme Court rejected creditors' objections and cleared the way for a new US automaker, said two people familiar with the matter.
The new company, Chrysler Group, will be owned 20 percent by Turin-based Fiat, 9.85 percent by the US, 2.46 percent by Canada, and 67.69 percent by a United Auto Workers union retiree healthcare trust.
The US and Canadian governments financed the sale with $2 billion.
The sale would fulfill President Obama's promise of a quick trip through bankruptcy and protection of 54,000 jobs.
Auburn Hills, Mich.-based Chrysler Group now starts fresh with lower debt, fewer expenses, reduced labor costs, a well-capitalized financing arm, and access to fuel-efficient vehicles and world markets through its Fiat partnership.
"They are going to be leaner and meaner - with management across the ocean," said Stephanie Brinley, an automotive analyst with Autopacific Inc. in Troy, Mich. "The new company has not lost some of the challenges of the old company. They don't have new cars yet and they are still competing in a difficult environment."
Lori McTavish, a Chrysler spokeswoman, didn't immediately comment on the court's ruling or the timeline for the sale.
Chrysler filed for bankruptcy protection on April 30, using the reorganization to retain its strongest assets and form an alliance with Fiat that ranks as the world's sixth-largest car maker.
