Sergio Marchionne named the merger of Fiat S.p.A with Chrysler Group, targeted to finish by 2014, to be the main goal for both companies. Even though the merger plan isn't finished yet, Chief Executive of both automakers is already trying to ease the process.
Speaking on the conference call about Fiat's Q3 results, CEO announced that they plan to convert savings and preference shares into ordinary shares in the near future. Marchionne said that the conversion would simplify the capital structure and remove the potential technical barriers to a full merger. Massimo Vecchio, a Mediobanca analyst, said that the share conversion plan, which is scheduled to be submitted for approval to a shareholder meeting in April 2012, is aimed at reduction of total number of issued shares and elimination of high dividends for the holders of preference and savings shares. According to The Wall Street Journal, at the moment Fiat is offering 0.85 of an ordinary share for each preferred share and 0.875 for each savings share.
Struggling to end Fiat's European losses, Marchionne wants to turn Fiat and Shrysler into a single, global auto maker, and thus to reduce costs and achieve the target of $142 billion in combined revenue by 2014. Chief executive also pointed out that prior to the merger, Fiat must reach an agreement with the UAW on what to do with the 41.5% Chrysler stake that the union's VEBA Trust owns, and get in place the necessary financing.