Marchionne won’t be Chrysler CEO

Sergio Marchionne, Fiat Group’s CEO has”absolutely no intention” of taking the reins at Chrysler if the companies are able to complete the proposed alliance. He added that he looks forward to working with Chrysler CEO Bob Nardelli and Vice Chairman Tom LaSorda.

Speaking to reporters, Marchionne said Fiat will not have a direct operating responsibility for the American carmaker. However, Fiat will have three members, including Marchionne, on a new seven member board.

One of the potential stumbling blocks is that Cerberus must persuade its bankers to convert roughly a third of the $9 billion in debt they are holding into equity. Another challenge is that Chrysler will need to obtain additional financial support from the federal government. The alliance is already under fire from Senator Robert Menendez (D-NJ) who wants President Obama to require Chrysler to pay back its loans if Fiat obtains a controlling interest. At this time, Fiat is looking for a 35 percent stake in Chrysler, which would still be subordinate to Cerberus’ 45.9 percent holding, so that shouldn’t be an issue.