The Fiat Group today purchased the remaining Chrysler LLC shares held by the U.S. and Canadian governments. The Italian company acquired a 1.5% fully diluted stake in Chrysler Group LLC from Canada for US$125 million, and a 6% stake from the United States Department of the Treasury for a price of US$ 500 million.
After acquiring the shares in the two separate deals, the Fiat Group now controls a 53.5% fully diluted equity interest in Chrysler LLC.
Upon the completion of the deal, U.S. Assistant Secretary for Financial Stability Tim Massad released this statement:
“With today’s closing, the US government has exited its investment in Chrysler at least six years earlier than expected. This is a major accomplishment and further evidence of the success of the Administration’s actions to assist the US auto industry, which helped save a million jobs during the worst economic crisis since the Great Depression.”
The U.S. Treasury noted that it committed a total of $12.5 billion to the Old Chrysler and Chrysler Group under TARP’s Automotive Industry Financing Program (AIFP), and up until now, has received back a little over $11.2 billion through principal repayments, interest, and cancelled commitments. This means, U.S. taxpayers lost around $1.3 billion.
“[The] Treasury is unlikely to fully recover the difference of $1.3 billion owed by Old Chrysler,” said a statement from the U.S. Treasury. “Treasury has the right to recover proceeds from the disposition of the liquidation trust associated with the bankruptcy of Old Chrysler but does not expect a material recovery from those assets.”
