Fiat CEO Sergio Marchionne Wednesday said that Chrysler may delay its initial public offering depending on the cash needs of the U.S. automaker and the auto workers union trust fund.
According to Reuters, Marchionne wants Fiat to have majority ownership of Michigan-based Chrysler and for Chrysler to repay $7 billion in U.S. and Canadian government loans before an initial public offering.
Marchionne has previously hinted that an IPO could happen by the end of the year.
Fiat, which owns at this moment a 25 percent stake in Auburn Hills, Michigan-based Chrysler can gain a further 10 percent stake in Chrysler in two steps if the U.S. carmaker reaches milestones including some sales goals outside of North America and a distribution agreement in Latin America.
“We have to get ready to be a public company again, and issuing securities takes time,” Marchionne said Wednesday after Fiat’s shareholder meeting in Turin, Italy.Marchionne confirmed that Fiat expects to raise its stake to 35% or more by the end of the year, up from its current 25%.
Department of Energy spokeswoman Ebony Meeks, in an e-mail, said the agency, “is actively working with Chrysler to discuss the framework of loan agreements.”