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Fiat says Chrysler merger on track after exit rights count
September 4, 2014 / 7:22 AM / 3 years ago

Fiat says Chrysler merger on track after exit rights count

The Fiat logo is seen on a Fiat vehicle displayed outside Chrysler World Headquarters during the FCA Investors Day in Auburn Hills, Michigan May 6, 2014. REUTERS/Rebecca Cook

MILAN (Reuters) - Fiat said most of its shareholders had chosen not to exercise an option that could have derailed a merger with U.S. affiliate Chrysler, a tie-up that is a vital step in the Italian carmaker’s turnaround efforts.

Chief Executive Sergio Marchionne wants to incorporate the two firms into a Dutch-registered company called Fiat Chrysler Automobiles (FCA), paving the way for a U.S. stock market listing that would help fund an ambitious investment plan.

But the plan could have failed if Fiat had been asked to pay more than 500 million euros ($657.1 million) to investors who chose to sell their shares, exercising a legal right triggered by the company’s decision to move its registered offices away from Italy.

The carmaker said on Thursday that shareholders opposing the deal had exercised exit rights for 60 million shares, equivalent to about 463.6 million euros - just shy of the 500 million euro threshold set by Fiat.

Those 60 million shares are equivalent to around 6.3 percent of Fiat’s 9.5 billion euro share capital.

Last week the company had said it did not expect shareholders to derail the merger, which is expected to be completed around the middle of October.

Creditors, including bondholders, still have the right to exercise exit rights. Fiat has said it does not expect creditor opposition to stand in the way of the merger.

(1 US dollar = 0.7609 euro)

Reporting by Oleg Vukmanovic and Stephen Jewkes; Editing by Pravin Char

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