Chrysler CEO says company to sell shares to public in '11
9/17/2010TURIN, Italy - Chrysler Group LLC Chief Executive Officer Sergio Marchionne said the U.S. car maker probably will sell shares publicly in the second half of 2011 after investors approved Fiat SpA's plan to spin off its industrial business.
"I don't think it's the first part; I think it's a second-half-year event," Mr. Marchionne, who is CEO of both companies, told reporters Thursday. He said Fiat, which acquired a 20 percent stake in Chrysler in June last year, will raise the holding to 25 percent as soon as December.
Rebecca Lindland, an analyst at IHS Automotive in Lexington, Mass., said, "People aren't focusing on Chrysler as the company that needs an IPO to pay back the government money."
Mr. Marchionne's "public discussion of an IPO at Chrysler could backfire because it will remind people that Chrysler did take government money," she said.
Chrysler, based in Auburn Hills, Mich., is majority-owned by a United Auto Workers union retiree health-care trust. Mr. Marchionne aims to increase Fiat's holding to 35 percent by the end of 2011.
The chief executive said there are signs that demand is picking up in the United States after "two crappy weeks" at the beginning of September.
Sales are "significantly improving as we go forward," he said. "I think it's a market that's looking for a direction." He has been working to reduce Chrysler's reliance on big discounts.