ITALY: All new cash offers considered - Fiat chairman
Fiat chairman Paolo Fresco said today that the struggling Italian industrial group would consider any offers of new cash as it battles to return its loss-making car unit to profit and slash debt, Reuters reported.
According to Reuters, Fresco, in a written statement published in Milan's Corriere della Sera newspaper, said Fiat had not looked for new financiers and did not intend to.
"However, it is our responsibility to take into consideration any valid proposals that would give us more flexibility and a stronger negotiating position with our partners," Fresco wrote, according to Reuters.
Reuters reported that media have said Fiat could seek fresh cash -- either from a new financial partner or by raising money on the markets -- to help Italy's biggest private employer fight through a slump in car sales and market share.
Last week, Reuters said, Bank of Italy governor Antonio Fazio said Fiat needed new financial backers to help relaunch output "after taking a strategic breather". Most of Italy's big banks are already highly exposed to Fiat, Reuters added.
Reuters said Fiat Auto is one fifth owned by General Motors which could be forced to buy the rest of the car unit from 2004 under a put option agreed with Fiat.
According to Reuters, Fresco said GM was open to keeping output, management and research facilities in Italy "whatever the future ownership of the company".
Earlier this year, Fiat signed a three-billion-euro rescue loan from banks, agreeing to cut net debt to three billion euros by early 2003 from 5.8% at the end of September, Reuters said, adding that gross debt must fall to 23.6 billion euros from 32.8 billion now.
Fiat, which has been selling off some assets and investments to cut and deconsolidate debt, had already freed up 7.5 billion euros, Fresco said, according to Reuters.
Reuters said Fresco wrote: "We think these resources will be enough for us to respect our debt-reduction targets we have agreed with the banks and debt rating agencies."