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Today is last day for Fiat exit rights

by Bill Cawthon on

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Wednesday is the last day for Fiat S.p.A. shareholders to exercise the exit rights they received in the merger of Fiat and Chrysler Group into Fiat Chrysler Automobiles, N.V.

Shareholders voting against the merger, which was approved on August first, are entitled to a buyout of €7.727 ($10.23) per share but they must have exercised that option by sending a registered letter postmarked no later than August 20.

About 84% of Fiat S.p.A. shareholders voted in favor of the merger.

In the merger agreement, there is a cap of €500 million ($661.4 million) on payments for the cash exit options. Should the amount of shares sold back to the company total more than the cap, the merger agreement will be null and void.

Fiat estimates that it will be the first week in September before it is known how many shareholders exercised their rights and if the merger agreement will move forward.

Fiat S.p.A. stock is currently trading at €7.18 ($9.54) per share on the Milan Exchange. The stock fell as low as €6.26 ($8.32) immediately following the merger vote but has recovered and was trading above the option value as recently as the 18th of this month.

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 just-auto.com, 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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