FCA meets with US investors over $2.5 billion bond issue and share sale

Article by Christian A., on December 8, 2014

Fiat Chrysler Automobiles has started meeting with investors in the United States after launching a $2.5 billion convertible bond issue and a share sale aimed at cutting its debt pile and funding its ambitious industrial plan. Fiat Chrysler is planning a EUR48-billion ($59 billion) five-year investment to transform Jeep, Maserati and Alfa Romeo into global brands as it seeks to boost its position in the high-margin market for premium vehicles.

FCA chief executive Sergio Marchionne launched the share and bond offers last week and started a four-day roadshow with investors in New York, according to bankers. To further raise its capital, Marchionne is planning to spin off Ferrari, offer a 10-percent share to the public and distribute its stake in the luxury sportscar maker to its Fiat shareholders and investors buying the convertible bond.

Marchionne’s announcement in Oct. 29, 2014, has led to a surge in FCA's shares, gaining over 40 percent since then. FCA said in a recent statement that it would also offer up to 100 million common shares in the public sale.

FCA’s shares also reached its highest price in 13 years this week on expectations that the bond issue would be fully covered, as investors would want to grab a piece of Ferrari, traders told Reuters. According to IFR, both the share sale and bond offering will be priced after the market closes on Dec. 10.

IFR estimates the $2.5-billion bond to have a price with a yield of between 7.125 percent and 7.875 percent. IFR estimates the rate at which the bond will be converted into shares including a premium in the range of between 17.5 and 22.5 percent. The bond will mature in 2016 and is seen pay an annual coupon. It may be also increased by up to $375 million at the option of the underwriters.

If you liked the article, share on:

Comments

Recommended

Renault Chairman and CEO Carlos Ghosn inaugurated the all-new Alpine A110 production line. This inauguration was attended by the Minister for Economy and Finance of France, Bruno Le Maire, with...
by - December 17, 2017
TOYOTA GAZOO Racing revealed that it will be participating in the 2018 Tokyo Auto Salon with the theme “Meister's Workshop.” The company will showcase models that have been part of...
by - December 16, 2017
Infiniti has commenced sales of the new 2018 Infiniti QX80 full-size luxury sports utility vehicle. Aside from the standard specs and optional features, potential customers would want to know how...
by - December 15, 2017
If there is one thing that Pagani Automobili and Fiat have in common, it is the fact that they are Italian companies that build and assemble vehicles. There is currently...
by - December 15, 2017
It’s Star Wars fever once again, and the second installation of the trilogy sequel -- “Star Wars: The Last Jedi” -- is finally hitting theaters. Avid fans of the franchise...
by - December 15, 2017
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