Chrysler Group will not hold IPO in 2013

Article by Anita Panait, on November 26, 2013

The Board of Directors of Chrysler Group of Chrysler Group has decided that it would not hold its initial public offering this year, according to majority shareholder Fiat SpA.  Chrysler-Fiat chief executive Sergio Marchionne had remarked that the IPO could occur this year. The listing was expected to establish the carmaker's value and help settle a row between Fiat and the VEBA health care trust that controls 41.5 percent of Chrysler.

Fiat said in a statement that it expected Chrysler to work toward an IPO in the first quarter of 2014, but could not say if and when the share sale would happen, since such offer would depend on "market conditions and other relevant considerations." Fiat is aiming to buy out VEBA’s stake in Chrysler, but the parties have been in dispute over the share price.

Chrysler filed IPO documents in late September. Investors had been hoping that the preliminary work for the IPO of 16.6-percent stake of VEBA would determine the price of the Chrysler shares, thereby helping settle the differences between Fiat and the trust and lead to an agreement without actually launching the offering.

According to the Wall Street Journal, Chrysler expects to gain between $1.5 billion and $2 billion in the share sale, which means that the US carmaker would be valued at between $9 billion and $12 billion. Some analysts value Chrysler at around $10 billion.

Topics: chrysler, ipo

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