Fiat’s recently announced 2010-2014 Plan sets a course of signifi cant growth. Today, the Group is a combination of two different businesses: on one side, the automobiles and related components businesses and, on the other, the truck and agricultural & construction equipment businesses. These two groups of activities are vastly different from each other in terms of their respective economic cycles, profit margins and capital requirements, as well as the characteristics of their customers and markets. And even the stock market has always valued them differently.
For this reason, our Plan also calls for a demerger of Iveco and CNH, along with the Industrial & Marine business of FPT Powertrain Technologies, from the automobile-related activities, which include Fiat Group Automobiles, Ferrari and Maserati, Magneti Marelli, Teksid, Comau and the Passenger & Commercial Vehicles business of FPT Powertrain Technologies. This demerger is expected to be completed by the end of 2010.
The share structure of Fiat Industrial (FI), the company formed by the demerger, will mirror Fiat S.p.A.’s current structure with ordinary, preference and savings shares that will be listed on the Milan stock exchange simultaneously with completion of the demerger. Every Fiat shareholder will own 1 Fiat share and 1 Fiat Industrial share.
The primary rationale behind this strategic choice is growth, autonomy and efficiency. With this new structure, the two groups will have the freedom to pursue the best strategic choices, including potential alliances, with complete freedom of movement and an operating profile that ensures the ability to create value.
More specifically, the automotive business will acquire the necessary flexibility to pursue further growth opportunities. The interest in Chrysler will acquire increased visibility and unlock synergies. Fiat Industrial, on the other hand, will finally have the opportunity to fulfil its role as a global capital goods player, leveraging on a solid worldwide presence.