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2014-01-02 10:02

FULL CONTROL: Italian automaker Fiat struck a R38-billion deal to gain full control of Chrysler, ending more than a year of tense negations. Image: SUPPPLIED

DETROIT, Michigan - Fiat has reached an agreement with the United Auto Workers (UAW) to purchase the rest of Chrysler.  The R38-billion deal marks the culmination of years of negotiations between the automakers, reports Detroit News.

Fiat acquired control of a then bankrupt Chrysler as part of a 2009 bailout deal brokered by the US Obama administration.

'HISTORIC DAY'

The Italian automaker owns 58.5% of the automaker but has long sought to acquire the remaining 41.5% from the UAW, which was given shares in Chrysler in exchange for concessions.

Fiat CEO Sergio Marchionne and chairman John Elkann called it “a historic day” for both Fiat and Chrysler.

Marchionne said: “After a protracted negotiation, we have reached an agreement that, through the acquisition by Fiat of a 100% equity interest in Chrysler, enables us to complete the union between the two groups in both financial and technical terms.”

Elkann said" “I have been looking forward to this day from the very moment that we were chosen to assist in the rebuilding of a vibrant Chrysler back in 2009."

Chrysler will pay the UAW trust four annual installments, this means the automaker will bear much of the cost of its acquisition by Fiat.

As part of the deal, the UAW agreed to continue to support Fiat’s efforts to turn around the struggling automaker.
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