ITALY: Fiat and General Motors still talk regularly - report
Fiat SpA said on Monday that it is in regular talks with General Motors Corp., confirming statements contained in a Securities Exchange Commission filing last Friday by GM, Dow Jones reported.
A Fiat spokesman told the news agency that the existence of the talks, which bear on the ownership of the Italian company's car unit, is well known and added that there is no calendar for their conclusion. The next round of high-level discussions might be at the Frankfurt motor show in the second week of September, the spokesman reportedly added.
Dow Jones noted that Fiat sold a 20% stake in Fiat Auto to GM in early 2000, securing a put option to sell the rest from 2004 to 2009. The two companies also have joint ventures in procurement and powertrains that both say are producing big savings, the report added.
The news agency noted that, however, Fiat has since committed €3 billion to the loss-making car unit, part of a €5 billion plan to recapitalise the 104-year-old company. GM hasn't contributed any cash to Fiat Auto, meaning its stake has slipped to 10%, Dow Jones said.
GM can restore its 20% stake by contributing €1 billion, the Fiat spokesman said, according to the report.
Dow Jones noted that, in a recent SEC filing of its own, Fiat underscored that it didn't intend to exercise the put option next year but also emphasised that it believed the contract was valid.
GM has, in past SEC filings and again in the one last Friday, questioned the validity of the put option contained in the master agreement that the two companies signed three years ago, the news agency's report said.