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Italy's Fiat ups ownership stake in Chrysler Group
After reporting another strong month of sales this week of Chrysler, Dodge and Jeep vehicles, Fiat is taking a bigger ownership stake in Chrysler Group.
The Italian auto giant, which already controls the running of Chrysler Group, told the United Auto Workers Retiree Medical Benefit Trust of its intent to purchase an additional 3.3% of Chrysler shares.
By exercising its call option the Italian automaker would increase its stake in Chrysler from 58.5% to 61.8%. The UAW Trust, which manages health care for Chrysler's UAW retirees, currently owns 41.5% of Chrysler's shares.
Fiat said it expects to complete the purchase "in the upcoming weeks."...
Ok, I will ask a dumb question...
If Fiat currently owns 58.5% of Chrysler and
the UAW Trust owns 41.5% of Chrysler......
That would mean Chrysler owns 0% of Chrysler.
How does that work?
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Chrysler is still chysler. When fiat buys more shares as it is doing, it is buying in or investing more into chrysler. by taking shares from the opposing interested party. Why do this? Yes it gives them more control (they already have a majority controlling share anyways) but it will increase their profit from their investment. It could mean they are inching their way towards full ownership of the business, that is if the opposing side is willing to sell all of their shares to fiat.
chrysler doesnt own any of its own shares because the company was sold and its worth divided. Chrysler is still the same business entity just with different parents.
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Ok, I will ask a dumb question...
If Fiat currently owns 58.5% of Chrysler and
the UAW Trust owns 41.5% of Chrysler......
That would mean Chrysler owns 0% of Chrysler.
How does that work?
You are correct, Fiat and UAW own Chrysler. Chrysler is another brand of Fiat, just as Ferrari, Alfa, and Lancia are.
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2006 Charger SRT8 Vortech Supercharged by SpeedLogix & 2012 Charger SRT8
This is a good thing. It means they have confidence in chrysler and the direction its heading. They have a financial interest in chrysler, want a bigger financial interest in them and see it as profitable.
Better than a certain multiple headed dog thought of the company as they ran it into the ground.
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some of you will already seen this but ill post it anyway.
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