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Fiat Chrysler begins Magneti Marelli spinoff

MILAN — Fiat Chrysler has kicked off its planned spinoff of parts maker Magneti Marelli, which will be registered in the Netherlands and listed on the Milan stock exchange, a document outlining initial plans and seen by Reuters showed. The spinoff is part of a plan by FCA Chief Executive Sergio Marchionne to "purify" the Italian-American carmaker's portfolio and to unlock value at Magneti Marelli similar to his earlier spinoff of Ferrari. Analysts say Magneti Marelli could be worth between 3.6 billion and 5 billion euros ($4.2 billion to $5.8 billion). It sits within FCA's components unit alongside robotics specialist Comau and castings firm Teksid. FCA has created a separate entity called MM Srl, the document showed, into which it will fold Magneti Marelli's electronics and electro-mechanical operations related to racing motorbikes and racing cars, as well as 14 other holdings in various companies around the world, including Germany, Slovakia, Mexico and South Africa. MM will be incorporated into a Dutch holding company via a cross-border merger, it added. FCA declined to comment. The move follows a similar procedure adopted by FCA for the spinoff and listing of Ferrari as well as of trucks and tractor maker CNH Industrial, both registered in the Netherlands and listed in Milan. The Dutch holding company would allow Marchionne, known for his success in extracting shareholder value through this strategy, to introduce a loyalty share scheme to reward long-term investors through multiple voting rights, as was the case with CNH and Ferrari. That would tighten the grip of FCA's controlling shareholder Exor, the Agnelli family's investment holding company, on the parts maker. Magneti Marelli, which employs around 43,000 people and operates in 19 countries, is a diversified components supplier specialized in lighting, powertrain and electronics. The Magneti Marelli separation is expected to be completed by the end of this year or early 2019, FCA has said. FCA's advisers initially looked at a possible initial public offering for the business to raise cash to cut FCA's debt, but the Agnelli family — FCA's main shareholder — was put off by low industry valuations and did not want its stake in Magneti Marelli to be diluted, three sources close to the matter told Reuters in March. Magneti Marelli has often been touted as a takeover target, and FCA has fielded interest from various rivals and private equity firms over the years.

Chrysler Pacifica-based crossover SUV coming soon

Chrysler is finally going to get another vehicle to support its minuscule lineup. According to Motor Trend, Fiat-Chrysler CEO Sergio Marchionne said that the company has a three-row crossover based on Chrysler's Pacifica minivan ready to go in as little as 18 months. Moving past the irony that Chrysler repurposed the old Pacifica crossover's name for a minivan, only for that very van to yield a new crossover, this is a vital vehicle for Chrysler that offers some interesting possibilities. Firstly, as we just mentioned, Chrysler hardly has anything in its lineup right now. With the departure of the 200, it was left with the 300 and the Pacifica. Both are perfectly fine machines, and we especially like the Pacifica, but they didn't leave the brand with much breadth for people who wanted something that wasn't a large sedan or a minivan. Both of those segments are giving up market share to crossovers, so a Pacifica-based crossover, one with three rows, will be beneficial beyond just offering another model, but also offering one that is more broadly popular, especially as more companies including Subaru and Volkswagen expand into the large three-row segment. The Pacifica platform also offers some unique opportunities for this upcoming Chrysler crossover. Using such a space-efficient starting point could give this Chrysler class-leading passenger and cargo space. Most interesting to consider, though, is the possibility of a plug-in hybrid. With the heavy lifting done during the Pacifica's development, it shouldn't be too difficult to adapt the PHEV powertrain to the new crossover. Shockingly, plug-in crossovers have only been tried by luxury brands and Mitsubishi, the latter with the Outlander PHEV. So this Chrysler could be in a class of its own by offering a larger PHEV than Outlander, but at a better price than the luxury automakers. As such, we're quite interested to see how this crossover turns out. Related Video: This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings.

Marchionne emailed Barra about merger between FCA and GM

Sergio Marchionne is adamant that global automakers will have to merge to remain profitable in the near future, and he'll tell that to anyone who's listening. Mary Barra, however, is not interested. According to The New York Times, the Fiat-Chrysler chief proposed a merger with General Motors via email to his counterpart back in March. Marchionne proposed meeting to discuss the matter, but Barra and her team reportedly rejected even entertaining the idea. This of course is not the first time Marchionne has raised the idea of a merger. He masterminded the marriage between Fiat and Chrysler, and reports have since suggested further mergers with Volkswagen, Peugeot, Ford, and others – including GM's own Opel unit. Some have taken his calls for consolidation as a weakness, but Marchionne insists that his empire is in good health – and that it's the industry as a whole which is in an untenable position. According to his view, automakers around the world need to align themselves into larger groups in order to reduce redundancy in investment, development and infrastructure – the duplication of which he terms as wasteful. "It's fundamentally immoral to allow for that waste to continue unchecked," said Marchionne to the Times. "I think it is absolutely clear that the amount of capital waste that's going on in this industry is something that certainly requires remedy," he said in a conference call with industry analysts late last month following the rejected GM approach. "A remedy in our view is through consolidation." News Source: The New York TimesImage Credit: Paul Sancya/AP Chrysler Fiat GM Sergio Marchionne merger fiat chrysler automobiles