According to Chrysler Group’s latest 8K Chrysler is now officially an Italian company.
On July 21, 2011, Fiat North America LLC, a wholly-owned subsidiary of Fiat S.p.A. (collectively, “Fiat”), acquired beneficial ownership of the membership interests in Chrysler Group LLC (the “Company”) held by the U.S. Department of the Treasury (“U.S. Treasury”) and the Canadian government’s special purpose entity, the Canada Development Investment Corporation (“Canadian government”). Fiat acquired 98,461 Class A membership interests in the Company from the U.S. Treasury, representing approximately 6 percent of the fully-diluted ownership interest in the Company for cash consideration of $500 million. Pursuant to a separate agreement, Fiat paid $125 million to acquire 24,615 Class A membership interests in the Company from the Canadian government, representing approximately 1.5% of the fully-diluted ownership interest.
Pursuant to these self-funded transactions, Fiat became the owner of a majority of the membership interests in the Company. Fiat now holds 55.3% of the Company’s outstanding equity, or 53.5% on a fully-diluted basis, taking into account the occurrence of the third and final Class B Event described in the LLC Operating Agreement which is expected to occur by the end of 2011. The remaining equity in the Company is owned by the UAW Retiree Medical Benefits Trust, a voluntary employees’ beneficiary association trust (the “VEBA”).
From now the United States taxpayers are fully-divested from their “investment” in Chrysler, because the brand is now a majority-owned division of Fiat. After Dodge’s new Fiat-based compact car gets 40 MPG unadjusted combined will be crtified by the EPA, the Italian company will get another 5% of Chrysler’s equity, bringing its stake in the company to 58.3%.
The Treasury estimated in a statement that the final cost of the bailout to be $1.3b (as it does not expect any meaningful recovery from Old Chrysler’s liquidation) even if that does not include several taxpayer outlays and without them the rescue of Chrysler would not have been possible.
Source: The truth about cars
Image from: Cars-10
