The US Department of the Treasury said on Thursday it reached an agreement to sell its remaining 6 percent equity stake in Chrysler to Italy’s Fiat in a deal that will net Washington US$560 million.
The deal on Thursday and Fiat’s purchase last week of 16 percent of Chrysler for $1.3 billion, value Chrysler at a little more than $8 billion. The Treasury owns 6 percent of Chrysler, on a fully diluted basis.
Chrysler last week also repaid the $7.5 billion it owed to the United States and Canada.
“As Treasury exits its investment in Chrysler, it’s clear that President Obama’s decision to stand behind and restructure this company was the right one,” said Treasury Secretary Tim Geithner, in a press release. “Today, America’s automakers are mounting one of the most improbable turnarounds in recent history — creating new jobs and making new investments in communities across our country.”
Fiat-Chrysler CEO Sergio Marchionne is now in a position to consolidate a full takeover of Chrysler by Fiat instead of making Chrysler a publicly traded company again after its bankruptcy.
“I don’t think there’s a 100 percent guarantee of the fact that there is an IPO,” said Marchionne at a recent event in Windsor, Ontario.