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Fiat denied raising funds to buy Chrysler

by Bill Cawthon on

Two Italian newspapers have published rumors of Fiat Group shopping banks to raise money to purchase the remaining shares of Chrysler Group.

This morning in Turin, the company released the following statement:

“The Italian newspapers Il Messaggero and Il Mattino reported this morning about alleged Fiat’s ongoing talks with banks regarding a proposed share capital increase. Fiat states that there is no specific project in such respect and believes that there is no need for a capital increase.”

Industry analysts have been upset that Fiat is putting off the acquisition of the shares currently held by the United Auto Workers retiree healthcare trust in favor of investing in Italian production facilities. Concerns have also been raised about the amount of debt the company will be carrying.

Therefore, it would seem only prudent that Fiat Group would eschew the expenses involved with raising the necessary money to exercise its options to buy the balance of Chrysler, especially when the value currently is under litigation in a Delaware court.

Bill Cawthon grew up in the auto industry in the 1950s. His Dad worked for Chrysler and Bill spent a number of Saturdays down on the plant floor at Dodge Main in Hamtramck. Bill is also the U.S. market correspondent for, a British auto industry publication, and a member of the Texas Auto Writers Association, which has named the Jeep Grand Cherokee the “SUV of Texas” several times and named the Ram 1500 as the “Truck of Texas” two years running.

Bill has owned five Plymouths (including the only 1962 “Texan”), one Dodge and one Chrysler and is still trying to figure out how to justify a Wrangler. He also has owned at least one of every 1:87 scale model of a Chrysler product. You can reach him directly at (206) 888-7324 or by using the form.

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