Tue September 24, 2013
Chrysler Announces Initial Public Offering
Originally published on Tue September 24, 2013 7:13 am
DAVID GREENE, HOST:
NPR's business news begins cars going public.
(SOUNDBITE OF MUSIC)
GREENE: The automaker Chrysler filed for an initial public offering late yesterday. After 41 consecutive months of auto sales growth, now might seem like the perfect time for the Detroit carmaker to sell shares to the public.
But as NPR's Sonari Glinton reports, this sale could be as much about brinksmanship as an IPO.
SONARI GLINTON, BYLINE: Chrysler is owned by two groups. The Italian carmaker Fiat owns about 60 percent. And the VEBA trust, which control's the United Auto Workers retirees' health care benefits owns the rest.
Fiat and its CEO Sergio Marchionne want to buy to the whole company. And the VEBA trust wants to sell but at a price.
KARL BRAUER: It's like a friend who wants to buy your car off you versus trying to put it on eBay.
GLINTON: Karl Brauer is with Kelley Blue Book.
BRAUER: So you can save yourself all the troubles of all eBay dealings and all the trouble of trying to find the buyer, but you could also be totally undervaluing your car and being screwed in the deal.
GLINTON: With rising health care costs, the VEBA trust needs as much money as it can get whether it's from the market or Fiat and Marchionne.
BRAUER: Like any buyer, he wants to buy for as little as possible; the sellers, the VEBA, wants to sell, and like any other sellers, they want to sell as much as possible. And their trying to figure out who's their best customer. Is it Marchionne and call it a day, without dealing with all the, you know, rigor of dealing with an IPO, or is it an IPO?
GLINTON: Chrysler stock is set to go on sale to the public in mid-November - that is unless Fiat comes up with a better deal.
Sonari Glinton, NPR News. Transcript provided by NPR, Copyright NPR.