Fiat Chrysler’s chief executive Sergio Marchionne has thrown the blame for the recent share sell-off on the media, accusing the press stories to be overblown and generally featuring a “lack of understanding” of the ongoing merger.
Because traders were worried of the outcome of the merger between Fiat SpA and Chrysler Group LLC, the Italian company’s shares dropped 8.5% to reach their lowest for the year, adding to the already big losses the company accounted so far.
“The press has overplayed the withdrawal rights scenario,” Marchionne told analysts. “We are paying the price for an overreaction … and a lack of understanding of what this means. I am absolutely unfazed by all of this,” Marchionne added. “We will wait until we have better conditions to get this done,” he added about the possible merger failure.
The carefully crafted plan for the two automakers to join forces could crumble if shareholders who are against it decide to exercise their rights to sell the shares back to Fiat. If a 500 million euro ($668 million) payout threshold is reached, the merger plan would fail. According to Marchionne, the final amount of shares that were affected by the exercise of exit rights will only be known close to the month’s end.