Italian automaker Fiat said Monday it had moved to increase its stake in US subsidiary Chrysler to nearly 70 per cent, despite still being locked in litigation over the price to pay to a
union-administered trust fund that owns the rest of the company.
In a statement, Fiat said it had exercised an option to buy out a third 3.3 per cent tranche of shares from the United Auto Workers' voluntary employees' beneficiary association (VEBA), offering 254.7 million dollars.
However, Fiat and VEBA, which funds health care for retired employees, are still arguing on the price of the previous two tranches the Italian company has offered to buy. Fiat has offered 140 million dollars for the first, while VEBA demanded about 200 million dollars more.
A judge in the US state of Delaware is due to resolve the issue, unless the two parties reach an out-of-court settlement.
"Negotiations with VEBA have not yet produced a successful outcome. We have nothing to announce," Fiat boss Sergio Marchionne said in Turin.
Once the sale of all three tranches is completed, Fiat will see its share in Chrysler rise to 68.49 per cent. It currently controls 58.5 per cent of the company, but plans to eventually acquire full control.
The outcome of the litigation with VEBA will determine how much Fiat will have to fork out to achieve its objective.
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