Fiat S.p.A.'s union leaders are meeting with top officials of the United Auto Workers union this week as they try to make it easier for the Italian carmaker to realize its plans to merge with Chrysler Group LLC. VEBA, a UAW retiree health-care trust, is forcing Fiat-Chrysler chief executive to prepare for the US carmaker’s initial public offering as both sides remained unsettled on the value of the shares owned by VEBA.
Fiat owns 58.5 percent in Chrysler while VEBA has the other 41.5 percent. Ferdinando Uliano, Fim Cisl national secretary in charge of Fiat relations for the Italian union, remarked that a Chrysler IPO may harm a combination of Fiat and Chrysler. Chrysler filed for an IPO on Sept. 23. A Fim Cisl delegation, which includes Uliano, plans to meet with UAW leaders, including President Bob King, as part of a scheduled trip to consult with their American counterparts.
Uliano remarked that they will tell UAW that only a merger of Fiat and Chrysler “would grant a positive future for both companies' workers." Marchionne has been trying hard to merge Fiat and Chrysler to form a global carmaker large enough to compete with Toyota, General Motors and Volkswagen. The Italian carmaker and the trust are currently at odds over the value of the stake, which VEBA says is valued at around EUR1 billion over what Fiat wants to pay.
The IPO may help resolve the price dispute but Fiat said the public offering may harm its relationship with Chrysler. Litigation is ongoing in a US court over the value of Chrysler shares. Delaware Chancery Court Judge Donald Parsons judge has set a September 2014 date to hear evidence. A five-day, non-jury trial will commence on Sept. 29, 2014. [source: automotive news - sub. required]