Fiat will decide on taking another 20% of Chrysler for $25m within a year.

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A preliminary agreement announced on Tuesday means Fiat would take 35% of Chrysler in exchange for its expertise in making small cars but the initial stake would not cost Fiat any money.


Within the next 12 months, Fiat will decide whether Chrysler has a chance to survive as a going concern, a source “close to the Italian industrial group” told Reuters.


“If Chrysler looks like it will get through the crisis they will draw the necessary conclusions and decide what to do,” the unnamed source said, confirming newspaper reports about the size and value of the extra stake.


Chrysler is 80.1% owned by private equity firm Cerberus Capital Management and Daimler has been reported as keen to sell its 19.9% stake.

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