Fiat to complete purchase of Serbia’s Zastava Automobili
By Andrew C., 26 Aug, 2010. 0 Comments
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Serbia and Fiat S.p.A. have come to terms with regards to the completion of Fiat's purchase of a majority stake in the country's biggest carmaker, Zastava Automobili. In 2008, Serbia and Fiat built a joint venture worth 1 billion euro ($1.43 billion) named Fiat Automobili Srbija, in which Fiat acquired 67% of the Zastava carmaker, while the government in Belgrade kept what remained. Because of the global economic crisis, Fiat delayed its investment in Zastava last year. As a result, Serbian government subsidies were used instead.
Last Sunday, Fiat's CEO Sergio Marchionne met with Serbia's President Boris Tadic in Turin. According to a statement from Tadic's office, the parties pledged that the deal with the Belgrade government will be signed this month.
President Tadic reportedly said that by the end of the year, Fiat will make its first 100 million euro payment, while the remainder will be paid quarterly. Fiat delayed investments in Zastava this year but then Fiat agreed with Belgrade to allow Zastava to assemble its Punto model for sale in Serbia and the Bosnian Serb part of neighboring Bosnia.
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