Marchionne: Fiat hopes to avoid Chrysler IPO

Fiat chief Sergio Marchionne said Monday that he would prefer to boost Fiat's shareholding in Chrysler via direct purchases from a union retirement fund rather than letting Chrysler first go public. With Fiat angling to increase its control of Chrysler from the current 65 percent, Marchionne said the push for an IPO by the United Auto Workers union retiree health benefits fund, which holds 16.6 percent, was a possible option. But asked if preferred to buy the shares directly from the fund, known as VEBA, rather than from the market after an initial public offering, Marchionne replied: "Ideally yes, if the price is in line with what we think is right." Fiat wants to increase its ownership of Chrysler by purchasing shares directly from VEBA. But last week VEBA pressed Chrysler to first undertake a public offering of its shares, after Fiat offered $198 million for another 3.3 percent. "I understand fully that they need to see their position monetized. You know, we'll try and get them a way to get there," he said. Ultimately Fiat's goal is a complete fusion of its own business with Chrysler's by 2015, but Marchionne believes an IPO could complicate that.