Fiat expects court decision on the acquisition of Chrysler shares held by VEBA
Under a bailout agreement Fiat, which owns 58.5 percent of Chrysler, is able to exercise call options to purchase portions of the 41.5 percent stake held by the VEBA healthcare trust, but the two are stuck in a court battle about the price Fiat would have to pay.
The troubled relationship between Italian Canadian Fiat Ceo Sergio Marchionne and unions is well-known, but this time problems are not arriving from the Italian Fiom, but from UAW, United Auto Workers, the major labor union representing auto workers in the USA, in his loved Detroit, where Marchionne can boast making all possible agreements with workers that enabled him to restore Chrysler, a bankrupt wreck three years ago.
Fiat against Veba
The dispute does not concern employees' work schedule or time off policies, what is at stake, this time, is a huge amount of money. The UAW, Retiree Medical Benefits Trust is a voluntary employee beneficiary association, or Veba, that owns about 41,5% of the automaker, while Fiat owns about 58% of Chrysler.
Fiat's target is the acquisition of shares held by the Retiree Medical Benefits Trust, in order to reach the full control of the historical American automaker. In this case Fiat would also have access to current assets which is allowed only in case of full control of the company.
Legal actions and Stock Exchange quotation
The Fiat's bid to win full control of Chrysler, however is set to become more difficult than expected.
The first attempt by Fiat of purchasing the car workers union's health care trust shares, in fact, ended up in court. The Delaware court, by March, will decide over the dispute concerning the price offered by Fiat to buy the 16,6 shares from the trust.
A troubled beginning of 2013 for Marchionne, who is already dealing with Italian and European market difficulties, and now will have to face problems from America that cannot be underevaluated, as the future control of now restored and profitable group such das Chrysler is concerned.