Fiat postpones Chrysler IPO until early next year
WASHINGTON -- Fiat on Monday said it would postpone an initial public offering of Chrysler Group stock until early 2014.
The move ends an attempt to sell shares owned by a United Auto Workers trust by the end of this year to help resolve a dispute over the value of that stock, which was obtained as part of the company’s 2009 bankruptcy and restructuring.
The federal government led the effort to remake Chrysler as part of a $12.5-billion bailout that, along with the $51-billion rescue of General Motors Co., was designed to save the U.S. auto industry during the depths of the Great Recession.
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Fiat purchased the government’s remaining stake in Chrysler in 2011, ending the bailout with a taxpayer loss of $1.3 billion.
The Italian automaker now owns 58.5% of Chrysler and wants to purchase the rest. The IPO was announced in September to help determine the value of the 41.5% minority stake owned by the UAW Retiree Medical Benefits Trust.
But Fiat said Monday it determined that “it will not be practicable” to launch and complete the IPO by the end of this year. The automaker said it now hoped to do so by the end of March.
A UAW spokeswoman did not immediately respond to a request for comment.
The union pushed for the IPO so investors could help determine the value of stock in Chrysler, which has rebounded from near bankruptcy in 2009 to post nine straight profitable quarters.
The union hopes the IPO of a portion of its Chrysler stock will help in negotiations over selling the rest of its stake to Fiat, which wants to merge the two companies.
The union trust provides medical coverage for about 115,000 retired Chrysler workers and their families.
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