Armed with another year of strong financial results from a resurgent Chrysler Group LLC, Fiat-Chrysler CEO Sergio Marchionne met with some of the biggest banks on Wall Street last week and asked them to back his plan to purchase the rest of the Auburn Hills automaker from a trust run by the United Auto Workers, according to sources familiar with the situation.
Marchionne told the bankers that Chrysler’s $1.7 billion profit and U.S. market share gains, coupled with his new turnaround plan for Fiat in Europe, make the group a better risk and a more attractive investment. Then he went behind closed doors with some of the banks and asked them to consider additional financing options, including a bridge loan, to give Fiat SpA the money it needs to buy out the shares held by the UAW, the sources said.
Just how much it would cost to do that remains a matter of serious contention between the company and the union. The two sides have been unable to agree on a pricing formula for the trusts’ shares, prompting Fiat to file a lawsuit late last year and ask a federal judge to do it for them.