Chrysler, Fiat form 'new Chrysler'
Chrysler Group LLC and Fiat Group have finalized their previously announced strategic alliance, forming a "new Chrysler," according to company officials.
Under terms approved by the U.S. Bankruptcy Court of New York, Chrysler LLC has formally sold all of its assets, without certain debts and liabilities, to a new corporation that will operate under the name Chrysler Group LLC.
Fiat holds 20% stake in the newly formed company, which will be led by Fiat chief Sergio Marchionne, who assumes the title of CEO.
Other owners include the United Auto Workers' Retiree Medical Benefits Trust (55% ownership), the U.S. Treasury (8%) and the Canadian government (2%). Fiat will have the right to boost its ownership stake by an additional 15% in three increments if it meets the following criteria:
* 5% for bringing a 40 mpg vehicle platform to Chrysler that would be made in the U.S.
* 5% for providing a fuel-efficient engine family to be made in the U.S. for Chrysler vehicles.
* 5% for providing Chrysler access to Fiat's "vast global distribution network to facilitate the export of Chrysler vehicles."
"We intend to build on Chrysler's culture of innovation and Fiat's complementary technology and expertise to expand Chrysler's product portfolio both in North America and overseas," Marchionne said in a statement issued earlier today, June 10.