Judge on Chrysler share valuation may rule for a trial

Article by Anita Panait, on June 21, 2013

Fiat chief executive Sergio Marchionne expects to know by end of September 2013 the price of the Chrysler Group shares the carmaker does not currently own so that he could complete the merger of the two companies as planned. But Marchionne, who is also CEO of Chrysler, may have wait a little longer, maybe a few months more, before he could learn the value of the Chrysler shares that Fiat seeks to buy out.

In 2012, Fiat asked Delaware Chancery Court Judge Donald Parsons to rule that call-option agreement covering shares owned by a UAW retiree health-care trust are valued $139.7 million. On the other hand, the trust values it shareholding in Chrysler at up to $342 million. Parsons is currently considering the matter based on pretrial filings by the two parties.

Charles Elson, director of the John L. Weinberg Center for Corporate Governance at the University of Delaware, told Bloomberg that Parsons is likely to call for a trial, where witnesses and experts could be questioned and cross-examined, before determining the value of the shares. He remarked that a trial would months to be completed, which means that Marchionne has to wait much longer before he could initiate a move to acquire the shares.

Elson told Bloomberg that Parsons would "want to take the time to get all the information" in a trial, noting that he is very careful judge. Parson may decide as early as July whether to rule on the value of the shares or force a trial. Larry Hamermesh, a Widener University professor who specializes in Delaware corporate law, told Bloomberg that if Parsons decide to force a trial, a final ruling on the shares’ value may be delayed by up to a year, noting that six months is already “incredibly fast.” [source: Bloomberg]

If you liked the article, share on:

Comments

Login or Create new account to add a comment!

Recommended

When Donkervoort Automobielen BV unveiled its Donkervoort D8 GTO-RS limited edition in May 2016, customer interest has been so overwhelming that the Lelystad, Netherlands-based carmaker sold out this one-of-a-kind vehicle...
by - December 8, 2016
Mazda’s RX-7 and RX-8 rotary sports car are two of the most beloved sports cars from Japan. Aside from their terrific road balance and agility, these sports cars are powered...
by - December 8, 2016
Nearly a decade after Opel and sister brand Vauxhall introduced the Insignia large family car, these companies are now getting ready to unveil the second generation of this offering from...
by - December 7, 2016
After we caught a glimpse of the revamped Amarok, VW Australia once again wants to give its ute a sinister look inspired by the Mad Max movie franchise. The “Korama”...
by - December 7, 2016
Customers in the European market are known for leaning towards style and with this in mind, Nissan has revealed the special LEAF Black Edition. While the production run of this...
by - December 7, 2016
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries