Breaking News Alert
The New York Times
Tuesday, June 9, 2009 -- 7:32 PM ET-----
Supreme Court Clears Way for Sale of Chrysler to Fiat
The United States Supreme Court declined Tuesday evening tohear a challenge to the Chrysler bankruptcy settlement, a dayafter Justice Ruth Bader Ginsberg had granted a stay in thecase. The ruling was a setback to a group of dissidentbondholders and will clear the way for the sale of Chrysler'skey assets to a group led by Fiat.
The United States Supreme Court declined Tuesday evening tohear a challenge to the Chrysler bankruptcy settlement, a dayafter Justice Ruth Bader Ginsberg had granted a stay in thecase. The ruling was a setback to a group of dissidentbondholders and will clear the way for the sale of Chrysler'skey assets to a group led by Fiat.
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P.S.
Fiat S.p.A., an acronym for Fabbrica Italiana Automobili Torino[3] (English: Italian Automobile Factory of Turin), is an Italian automobile manufacturer, engine manufacturer, financial and industrial group based in Turin in the Piedmont region. Fiat was founded in 1899 by a group of investors including Giovanni Agnelli. Fiat has also manufactured tanks and aircraft.
Fiat Group is the largest vehicle manufacturer in Italy, with a range of cars starting from small Fiat city cars to sports cars made by Ferrari, and vans and trucks ranging from the Ducato to Iveco commercial trucks. Besides Fiat Group Automobiles S.p.A, the Fiat Group automotive companies include Ferrari S.p.A., Iveco S.p.A. and Maserati S.p.A. The Fiat Group Automobiles S.p.A. companies include: Abarth & C. S.p.A., Alfa Romeo Automobiles S.p.A., Fiat Automobiles S.p.A., Fiat Professional and Lancia Automobiles S.p.A.. Ferrari S.p.A. is 85% owned by the Fiat Group, but is run autonomously.
Publishing and communication
Fiat group also owns important editorial brands, like La Stampa (created in 1926 for the famous newspaper), Itedi, and Italiana Edizioni. Some national and local newspapers are owned or otherwise controlled by the different companies. A specialised advertising space reseller is Publikompass, supported by the Consorzio Fiat Media Center.
Fiat group also owns important editorial brands, like La Stampa (created in 1926 for the famous newspaper), Itedi, and Italiana Edizioni. Some national and local newspapers are owned or otherwise controlled by the different companies. A specialised advertising space reseller is Publikompass, supported by the Consorzio Fiat Media Center.
Fiat is also present in the combat vehicle sector through a consortium between Iveco and OTO Melara, their most notable product being the LAV B1 Centauro.
Potential Takeover of GM Europe
In April and May 2009, the possibility of a take over of GM Europe, a subsidury of General Motors, was being discussed between the two companies. GM Europe owns Opel/Vauxhall and Saab, and, if the deal is successful, will make Fiat the second largest automobile manufacturer in the world, behind Toyota.
On May 30th, 2009, German officials named [Magna] International, an Austro-Canadian car parts manufacturer, to take over Opel. The Opel/Vauxhall partnership is the largest of GM Europe's operations.[21]
In April and May 2009, the possibility of a take over of GM Europe, a subsidury of General Motors, was being discussed between the two companies. GM Europe owns Opel/Vauxhall and Saab, and, if the deal is successful, will make Fiat the second largest automobile manufacturer in the world, behind Toyota.
On May 30th, 2009, German officials named [Magna] International, an Austro-Canadian car parts manufacturer, to take over Opel. The Opel/Vauxhall partnership is the largest of GM Europe's operations.[21]
Partnership with Chrysler
On 20 January 2009, Fiat S.p.A. and Chrysler LLC announced that they were going to form a global alliance. Under the terms of the agreement, Fiat would take a 35% stake in Chrysler and gain access to its North American dealer network in exchange for providing Chrysler with the platform to build smaller, more fuel-efficient vehicles in the US and reciprocal access to Fiat's global distribution network.[25][26]
On 20 January 2009, Fiat S.p.A. and Chrysler LLC announced that they were going to form a global alliance. Under the terms of the agreement, Fiat would take a 35% stake in Chrysler and gain access to its North American dealer network in exchange for providing Chrysler with the platform to build smaller, more fuel-efficient vehicles in the US and reciprocal access to Fiat's global distribution network.[25][26]
The new equity holder would have the option of increasing that to as much as 55%. Fiat, the stronger of the two, would not immediately put cash into Chrysler. Instead it would obtain its stake mainly in exchange for covering the cost of retooling a Chrysler plant to produce one or more Fiat models to be sold in the U.S. Fiat would also provide engine and transmission technology to help Chrysler introduce new, fuel-efficient small cars.
The deal is the latest maneuver by Fiat's chief, Sergio Marchionne, who has pulled the Italian company back from the brink of collapse since taking over in 2004.
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Fiat would not have to pay any money for its 20% of Chrysler. On June 7, 2009, the Indiana State Police Pension Fund, the Indiana Teacher's Retirement Fund, and the state's Major Moves Construction Fund asked the U.S. Supreme Court to delay the sale of Chrysler to Fiat while they challenge the deal. The funds argued that the sale went against U.S. bankruptcy law because it unlawfully rewarded unsecured creditors ahead of secured creditors.[29]. On June 9, 2009, the Supreme Court lifted the temporary hold, clearing the way for Fiat to acquire Chrysler.[30] See Indiana State Police Pension Trust v. Chrysler for more information.
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Sergio Marchionne
Sergio Marchionne (born June 17, 1952 in Chieti, Italy[1]) is a dual nationality Canadian and Italian businessman and has been CEO of the Fiat S.p.A. since June 1, 2004. In January 2006 he was also elected Chairman of the European Automobile Manufacturers Association (ACEA).[2] He is the Chairman of SGS and a member of the Board of Directors of UBS. On February 21, 2008, the same board of directors of UBS appointed Marchionne as non-executive vice chairman.[3]
In 2006, he was nominated to be a ""Cavaliere del Lavoro" by Italian President Giorgio Napolitano.[1]
Marchionne, together with Fiat Group Chairman Luca Cordero di Montezemolo, returned Fiat's automobile division (Fiat Group Automobiles S.p.A.) to profitability in 2006.[4] Together, they have been widely credited with the turnaround of the group into one of the fastest growing companies in the auto industry.[5]
Marchionne has stated he is on "the list" for one of the limited run of 500 Alfa Romeo 8C Competizione.[6]
In 2006, he was nominated to be a ""Cavaliere del Lavoro" by Italian President Giorgio Napolitano.[1]
Marchionne, together with Fiat Group Chairman Luca Cordero di Montezemolo, returned Fiat's automobile division (Fiat Group Automobiles S.p.A.) to profitability in 2006.[4] Together, they have been widely credited with the turnaround of the group into one of the fastest growing companies in the auto industry.[5]
Marchionne has stated he is on "the list" for one of the limited run of 500 Alfa Romeo 8C Competizione.[6]
The son of Concezio Marchionne, a Carabiniere originally from the Abruzzese town of Cugnoli, and Maria Zuccon from Carnizza in Istria, Sergio was born in Chieti, Abruzzo. At age 13, Marchionne and his family emigrated to Toronto, Canada where they had relatives. [7] Consequently, he has dual Canadian and Italian citizenship. He is a barrister and solicitor, and Certified General Accountant. He is also a member of the Canadian Institute of Chartered Accountants.[8] His undergraduate studies were completed at the University of Toronto. He went on to earn his Masters in Business Administration (MBA) from the University of Windsor in 1980 and his Bachelor of Laws (LLB) from Osgoode Hall Law School of York University in 1983.[9]
He began his professional career in Canada. From 1983 to 1985 he worked as a chartered accountant and tax specialist for Deloitte & Touche. From 1985 to 1988 he was Group Controller and then Director of Corporate Development at the Lawson Mardon Group in Toronto. In 1989 he moved to Glenex Industries where he worked for two years as Executive Vice President.
He began his professional career in Canada. From 1983 to 1985 he worked as a chartered accountant and tax specialist for Deloitte & Touche. From 1985 to 1988 he was Group Controller and then Director of Corporate Development at the Lawson Mardon Group in Toronto. In 1989 he moved to Glenex Industries where he worked for two years as Executive Vice President.
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It is announced that when Chrysler emerges from Chapter 11 bankruptcy, (which is estimated to be in June of 2009), Marchionne will replace Robert Nardelli as the company's CEO. [1]
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Robert Nardelli
Robert Louis Nardelli (born May 17, 1948, in Old Forge, Pennsylvania) is the chairman and chief executive officer of Chrysler. He had earlier served in a similar capacity at The Home Depot from December 2000 to January 2007. Prior to that, Nardelli had risen to become one of the top four executives at General Electric. CNBC named Nardelli as one of the "Worst American CEOs of All Time".[1]
He attended Rockford Auburn High School in Rockford, Illinois and received his Bachelor of Science in business from Western Illinois University in Macomb, where he was a member of the Tau Kappa Epsilon fraternity. Nardelli also earned an MBA from the University of Louisville.
He attended Rockford Auburn High School in Rockford, Illinois and received his Bachelor of Science in business from Western Illinois University in Macomb, where he was a member of the Tau Kappa Epsilon fraternity. Nardelli also earned an MBA from the University of Louisville.
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Home Depot
Nardelli became CEO of Home Depot in December 2000, despite having no retail experience. Using the Six Sigma management strategy also used at GE, he dramatically overhauled the company and replaced its freewheeling entrepreneurial culture. He changed the decentralized management structure, by eliminating and consolidating division executives. He also installed processes and streamlined operations, most notably implementing a computerized automated inventory system and centralizing supply orders at the Atlanta headquarters.
Nardelli was credited with doubling the sales of the chain and improving its competitive position. Revenue increased from $40.57 billion in 2000 to $85.15 billion in 2005, while profit rose from $12.6 billion to $25.8 billion. While this was a slower rate of growth than Home Depot had previously experienced (the company doubled in size every 4 years from 1979 to 2001), it must be noted that the high growth rates were largely due to rapid expansion.[citation needed] As the company was reaching its retail limit in the U.S., Nardelli was brought in to shepherd its transition into a mature business.[citation needed]
Some have criticized him for not maintaining the growth that the company had previously experienced, pointing to his huge salary as a sign that he was actually supposed to bring innovation to the company in order to help it maintain its historical growth. During Nardelli's tenure, Home Depot stock was essentially steady while competitor Lowe's stock doubled, which along with his $240 million compensation eventually earned the ire of investors.[2] His blunt, critical and autocratic management style turned off employees and the public. While the board strongly stood by him for most of his tenure, questions about his leadership mounted in 2006, and in an ominous portent of the near future, he was the only director present at the annual meeting; he only allowed shareholders to speak for a minute each.[3] When the board reportedly ousted him in January 2007,[4] Nardelli's severance package was estimated at $210 million. He was succeeded by The Home Depot vice chairman and executive vice president, Frank Blake. Blake had served as Nardelli's deputy at both GE Power Systems and Home Depot.
During his tenure at Home Depot, Nardelli met President George W. Bush at the White House in 2002 and was appointed to Bush's Council on Service and Civic Participation (although he is no longer a member).[5] Nardelli also hosted a garden reception/fundraiser for Bush at his Atlanta home on May 20, 2004[6]
Coca-Cola
While CEO of Home Depot, Nardelli was also briefly on the Board of Directors for Coca-Cola, starting in 2001.
Nardelli became CEO of Home Depot in December 2000, despite having no retail experience. Using the Six Sigma management strategy also used at GE, he dramatically overhauled the company and replaced its freewheeling entrepreneurial culture. He changed the decentralized management structure, by eliminating and consolidating division executives. He also installed processes and streamlined operations, most notably implementing a computerized automated inventory system and centralizing supply orders at the Atlanta headquarters.
Nardelli was credited with doubling the sales of the chain and improving its competitive position. Revenue increased from $40.57 billion in 2000 to $85.15 billion in 2005, while profit rose from $12.6 billion to $25.8 billion. While this was a slower rate of growth than Home Depot had previously experienced (the company doubled in size every 4 years from 1979 to 2001), it must be noted that the high growth rates were largely due to rapid expansion.[citation needed] As the company was reaching its retail limit in the U.S., Nardelli was brought in to shepherd its transition into a mature business.[citation needed]
Some have criticized him for not maintaining the growth that the company had previously experienced, pointing to his huge salary as a sign that he was actually supposed to bring innovation to the company in order to help it maintain its historical growth. During Nardelli's tenure, Home Depot stock was essentially steady while competitor Lowe's stock doubled, which along with his $240 million compensation eventually earned the ire of investors.[2] His blunt, critical and autocratic management style turned off employees and the public. While the board strongly stood by him for most of his tenure, questions about his leadership mounted in 2006, and in an ominous portent of the near future, he was the only director present at the annual meeting; he only allowed shareholders to speak for a minute each.[3] When the board reportedly ousted him in January 2007,[4] Nardelli's severance package was estimated at $210 million. He was succeeded by The Home Depot vice chairman and executive vice president, Frank Blake. Blake had served as Nardelli's deputy at both GE Power Systems and Home Depot.
During his tenure at Home Depot, Nardelli met President George W. Bush at the White House in 2002 and was appointed to Bush's Council on Service and Civic Participation (although he is no longer a member).[5] Nardelli also hosted a garden reception/fundraiser for Bush at his Atlanta home on May 20, 2004[6]
Coca-Cola
While CEO of Home Depot, Nardelli was also briefly on the Board of Directors for Coca-Cola, starting in 2001.
Chrysler
On August 5, 2007, he became chairman and CEO of the newly privatized Chrysler. His current annual salary at Chrysler is $1, with other compensation not publicly disclosed.[7]
On February 17, 2008, before his first Daytona 500 race as Chrysler CEO, Nardelli guaranteed that Dodge would win the race for the first time since 2002, and that he would award a $1 million bonus to the Dodge team that did it. Ryan Newman, the driver of the #12 Alltel Dodge, fulfilled this promise, and his car owner Roger Penske collected the $1 million bounty.[8]
On December 4, 2008, in an appearance on CNN's Situation Room with Wolf Blitzer, when asked "So what do you say about the argument that the Japanese, the Germans, Koreans make better cars than the Americans?" Nardelli responded, "We spent about half a billion dollars in the first several months. Our warranty costs are down 29%. It's an interesting comparison because in the hearing today, going around the panel, the majority of the Senators said that citing specific vehicles that they own that they've got 60, 70, 80,000 miles. The comment was you guys are making them too good and therefore, we're not buying vehicles and we're contributing to your problem. That was from the Senators on the committee today. On April 30, 2009 Bob Nardelli announced that he would leave the company as soon as the bankruptcy was over."[9]
On March 17, 2009, Nardelli said that Chrysler Financial would require a second round of loans.[10] On April 21, 2009, it was revealed that a $750 million loan from the government was turned down, on the grounds that it would have required that executive compensation be capped.[11] On April 30, 2009, Chrysler filed for Chapter 11 bankruptcy, and it was announced that Nardelli's replacement (Sergio Marchionne [12]) would likely face a pay cap.[13]
On August 5, 2007, he became chairman and CEO of the newly privatized Chrysler. His current annual salary at Chrysler is $1, with other compensation not publicly disclosed.[7]
On February 17, 2008, before his first Daytona 500 race as Chrysler CEO, Nardelli guaranteed that Dodge would win the race for the first time since 2002, and that he would award a $1 million bonus to the Dodge team that did it. Ryan Newman, the driver of the #12 Alltel Dodge, fulfilled this promise, and his car owner Roger Penske collected the $1 million bounty.[8]
On December 4, 2008, in an appearance on CNN's Situation Room with Wolf Blitzer, when asked "So what do you say about the argument that the Japanese, the Germans, Koreans make better cars than the Americans?" Nardelli responded, "We spent about half a billion dollars in the first several months. Our warranty costs are down 29%. It's an interesting comparison because in the hearing today, going around the panel, the majority of the Senators said that citing specific vehicles that they own that they've got 60, 70, 80,000 miles. The comment was you guys are making them too good and therefore, we're not buying vehicles and we're contributing to your problem. That was from the Senators on the committee today. On April 30, 2009 Bob Nardelli announced that he would leave the company as soon as the bankruptcy was over."[9]
On March 17, 2009, Nardelli said that Chrysler Financial would require a second round of loans.[10] On April 21, 2009, it was revealed that a $750 million loan from the government was turned down, on the grounds that it would have required that executive compensation be capped.[11] On April 30, 2009, Chrysler filed for Chapter 11 bankruptcy, and it was announced that Nardelli's replacement (Sergio Marchionne [12]) would likely face a pay cap.[13]
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P.S. II:
Tutti bene; Finito, Capite?
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Arsenio!
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