Fiat on Monday said it planned to split its financial and industrial operations into separate businesses, confirming a plan that a newspaper said was aimed at grouping together its lending arms.
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A Fiat spokesman told Reuters the plan was disclosed in its results slide presentation on Friday, which said the company planned for a full separation in 2004 of the balance sheet, profit and loss and cash flow for industrial and financial operations.
The plan would emulate a structure adopted by rivals General Motors and Ford, which have both split off financial units from their core car building businesses, the Financial Times said on Monday, according to Reuters.
The newspaper, citing a person close to the car maker, reportedly said Fiat was looking to combine existing lending divisions of each of its industrial units, including its 49% stake in Fidis, which offers loans to buyers of Fiat cars.
The finance businesses of Fiat’s CNH agricultural equipment operation and its Iveco truck business would also be put into the centrally run organisation, the paper said, according to Reuters.
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By GlobalDataFiat hoped that such a structure would create economies of scale among the financial operations, making it easier to fund lending through bond sales, the Financial Times reportedly said.
“It would also make the company easier for financial analysts and shareholders to understand,” the paper added, according to the news agency.
Reuters noted that the 105-year-old car maker last week posted a wider-than-expected net loss for 2003, but said a restructuring plan aimed at pulling it to operating breakeven had delivered results in the last quarter.
