Italy’s Fiat SpA is likely to increase its stake in Chrysler to 61.8% in July, Chief Executive Sergio Marchionne said on Thursday.
Fiat has an option to buy a roughly 3 percent stake in Chrysler from the retiree healthcare trust affiliated with the United Auto Workers union beginning in July.
The UAW trust currently owns 41.5% of Chrysler as a result of the 2009 restructuring that enabled Chrysler to exit Chapter 11 bankruptcy.
The investment had been planned since the original operating agreement between Fiat and Chrysler in 2009, as an opportunity that becomes available on July 1, 2012.
Fiat can continue to buy up 3.32% chunks of Chrysler every six months until June 30, 2016. Even though the move is mostly ceremonial, it signals Fiat’s solidified commitment to Chrysler and the U.S. market.
Starting in July, the Italian automaker has the option to buy 40 percent of the VEBA’s stake in Chrysler in small increments – but again — a maximum of 3.3 percent of Chrysler every six months.