Chrysler Sells Assets to Fiat

June 10, 2009
Fiat will take a 20% share in Chrysler, UAW will hold 55% and the U.S. and Canadian governments will own 10%

The sale of Chrysler's key assets to a consortium headed by Fiat of Italy will be completed on June 10, a Fiat spokesman said.

An obstacle to the transaction was cleared on June 9 when the U.S. Supreme Court lifted a freeze on a deal to save Chrysler from liquidation via an alliance with Fiat. The nine-member court late reversed the freeze, introduced by Justice Ruth Bader Ginsberg the previous day, which had given justices time to weigh complaints from Chrysler investors who said they would be short-changed and their rights trampled by the Fiat deal.

In a two-page order, the court said the disgruntled investors -- a group of Indiana pension funds -- had failed to show "that the circumstances justify" the stay placed on a lower court's approval of the deal.

Italy's Fiat, one of Europe's biggest auto makers, is now expected to take an initial 20% share in Chrysler in return for sharing technology that can be used to build, smaller, more fuel efficient cars.

The United Auto Workers union will hold 55% of Chrysler and the U.S. and Canadian governments 10%.

Fiat could gradually boost its interest to 35% and would have an option to take control of the group from 2013.

Fiat boss Sergio Marchionne will head the new-look Chrysler.

Copyright Agence France-Presse, 2009

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