JPMorgan Chase & Co might lead Chrysler’s IPO, according to a CNBC report.
This IPO is seen as the only solution to bring to head the battle between Sergio Marchionne, who is Fiat’s and Chrysler’s CEO, and VEBA, the healthcare trust fund affiliated with the UAW union. By the end of this month Chrysler will file the necessary documents which will allow its minority investor to sell shares of the US automaker in a stock market listing.
“We need to go trough this process of determining value,” Marchionne said. “(VEBA) have been very clear that they are not long-term holders of the assets. They want to monetize so we need to find a way that … does not create what I consider to be exceptionally high or abnormal expectations of value.”
This move will slow Fiat’s goal of taking full control of Chrysler as soon as possible. VEBA is exercising its right to push Chrysler’s CEO to take the company public, as it was not happy with the price the Italian automaker has offered for the stake.
“It’s in the interest of both parties, but of Fiat in particular, to reach an agreement before a Chrysler IPO,” said ICBPI analyst Luca Arena.