This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at http://www.bbc.co.uk/news/business-29817720
The article has changed 3 times. There is an RSS feed of changes available.
Version 0 | Version 1 |
---|---|
Fiat Chrysler to spin off Ferrari into separate unit | Fiat Chrysler to spin off Ferrari into separate unit |
(about 1 hour later) | |
Fiat Chrysler Automobiles (FCA) plans to spin off Ferrari and sell a 10% stake in the luxury carmaker on the stock market. | Fiat Chrysler Automobiles (FCA) plans to spin off Ferrari and sell a 10% stake in the luxury carmaker on the stock market. |
The remaining Ferrari shares would be distributed among FCA shareholders. | The remaining Ferrari shares would be distributed among FCA shareholders. |
The carmaker wants to complete the spin-off next year, with Ferrari shares listed in the US and possibly having a European listing too. | The carmaker wants to complete the spin-off next year, with Ferrari shares listed in the US and possibly having a European listing too. |
The sale is part of a bigger plan by FCA to raise €48bn ($61bn; £38bn) to fund an investment plan. | The sale is part of a bigger plan by FCA to raise €48bn ($61bn; £38bn) to fund an investment plan. |
Fiat Chrysler chief executive Sergio Marchionne said it was "proper that we pursue separate paths for FCA and Ferrari" following the completion of the merger of Chrysler and Fiat with a listing on the New York Stock Exchange on 12 October. | |
The following day, Ferrari president Luca di Montezemolo officially left the company. | |
Mr di Montezemolo's departure from Ferrari followed a public spat over strategy with Mr Marchionne. He has since taken over as chairman of the luxury carmaker. | |
Mr Marchionne had been a vocal critic of the on-track performance of Ferrari's Formula One team, particularly its lack of world titles since 2007. He has pledged to get the team back to winning ways. | |
Rescue deal | |
Earlier this month, he described the merger between Fiat and Chrysler as "the end of a long historical cycle". | |
That merger began when Chrysler filed for Chapter 11 bankruptcy protection in April 2009. | |
Chrysler had agreed a deal with its creditors including JP Morgan, Citigroup and Goldman Sachs, brokered by the US Treasury and Obama administration, to write off two-thirds of the car manufacturer's debt. | |
But a group of hedge and investment funds refused to accept the last-minute debt-for-equity package, which would have seen Chrysler's $6.9bn (£4.6bn) debt cancelled in return for a cash payment of $2bn. | |
When it emerged from bankruptcy later that year, Fiat owned 35% of the company, alongside the United Auto Workers pension fund on 41.5% and the US and Canadian governments owning the remainder. | |
Over the last five years, Fiat has bought out Chrysler's other owners, buying the final tranche of the car manufacturer from the United Auto Workers pension fund in January. | |
A Ferrari spin-off had long been anticipated by industry experts as Mr Marchionne seeks to maximise values from the group's various brands. | |
Profit | |
There are no plans to spin off FCA's other luxury brands, including Alfa Romeo and Maserati, it said. | |
The announcement of the Ferrari spin-off comes as FCA said it returned to profit in the third quarter on a strong rise in sales of its luxury brands, as well as revenue gains in North America and Asia. | |
FCA reported a net profit of €174m for the three months to the end of September, compared with €15m a year earlier. | |
Revenues were 14% higher at €23.5bn. Luxury brand sales increased 35% overall, while North America saw a 20% rise in revenues and sales in Asia rose 30%. Both markets helped offset a 12% fall in revenue in a weak Latin American market. |