It seems the media is keen on stirring the pot with the thought of a Fiat-Chrysler and General Motors merger.
Following the most recent shareholder meeting in the Netherlands, FCA CEO, Sergio Marchionne, was questioned on if he plans to launch a hostile takeover of GM.
According to The Detroit Free Press, Marchionne has no intentions to launch such a bid after being rejected both privately and publicly by GM CEO, Mary Barra.
“This is not an indiscriminate dating game. I’m not willing to go with anybody to get it done. We have been publicly rebuffed, we have been rejected and you cannot force these things. I don’t want to. At the moment, we have no intention to do anything hostile.”
Instead, the FCA CEO said he will focus on the automaker’s growth plan through 2018, and is readying its latest minivan to show at the 2016 North American International Auto Show.
Comments
I think the media really dose not get it. You don’t launch a hostile takeover of a company the size of GM when your the size of FCA. The Anti-trust sanctions alone would stop this dead in its tracks even if both companies agreed to it. What really happened here is Mergio exhausted every possible avenue and in the end failed. His only small hope was getting the activists investors on board, and even they were not interested in a merger. And with GMs stock moving up with sales it will be impossible for FCA to even think of a takeover in the future. GM is stronger than it was even 1 year ago.
I enjoy the nickname Mergio. Mergio Macaroni.
On a serious note I agree. He is not “deciding not to do a hostile take over”. He had neither the bank account or investor support for the check his mouth was writing.
I’m sure this is tied into the fact that they are in a lot of trouble for lying about the current financial / future investment state of their own FCA. Perhaps he painted a pretty picture at first and got some investors interested, which made him think a hostile takeover was possible. Then they found out how full of crap he was…
While FCA CEO Sergio Marchionne says he has no intentions of attempting a hostile takeover of General Motors, Marchionne is a desperate man and unpredictable with what he may or may not do because one cannot take Marchionne’s word especially when FCA is almost broke while General Motors is sitting on a lot of cash reserves that could pay off all of FCA’s bills and fund future FCA projects.
Chances are slim.
BUT, myself and others have brought this up before …
FCA is part of Exor. Exor’s the Agnelli family version of Berkshire Hathaway –
Billions at their disposal, Gianni’s grandson (young CEO) seems to have something to prove. FCA’s not a huge success, but they want their investment to pan out.
So – they could buy enough GM shares to demand a seat or two on the Board? Remember, earlier this year, the hedge fund guy who was ‘helping’ Ratner during the BK proceedings attempted to force an $8b stock buyback and a seat on the board.
He had to settle for $5b and no seat, but Exor is a bigger player than a hedge fund guy.
Like I said, sort of unlikely, but within the realm of possibility. Oh, and Mergio is also vice-chairman of Exor.
Anyway, it’s bigger than a purely FCA play, it would seem …
The merger could have happened but Sergio had no real support out side his inside supporters. GM is only growing stronger and have no interest.
Now if Sergio could have taken the money firm he is with and join it with 2-3 other money firms they could have pulled it off due to the low stock prices. But there are just no real support out there for Sergio as I have stated and he has finally had to admit defeat in his own way.